Markets

Daily Market Wire 5 May 2022

Lachstock Consulting, May 5, 2022

Among the markets gaining overnight were crude oil 5pc, wheat 3pc, soybean oil 3pc, canola 2pc, the Australian dollar 2pc and the Dow Jones Industrials Average gained 3pc.

  • Chicago wheat July contract up US31 cents per bushel to 1076.5c/bu;
  • Kansas wheat July contract up 30.5c/bu to 1123.25c/bu;
  • Minneapolis wheat July up 21.75c/bu to 1177.25c/bu;
  • MATIF wheat September contract up €10.25/t to €387.50/t;
  • Black Sea wheat July contract up $6.50/t to $370.50/t;
  • Corn July contract up 1.25/bu to 794.25c/bu;
  • Soybeans July contract up 10c/bu to 1640.5c/bu;
  • Winnipeg canola November 2022 contract up C$24.70/t to $1077.50/t;
  • MATIF rapeseed November 2022 contract up €17.25/t to €821.75/t;
  • ASX July 2022 wheat contract up A$1.50 to $418.50/t;
  • ASX Jan 2023 wheat contract unchanged at $428/t;
  • AUD dollar firmer at US$0.726 up 2pc

International

The US Federal Reserve came out of the blocks hard with the biggest single interest rate increase in 22 years. All 12 members of the policy-setting FOMC agreeing to hike rates by 50 basis points additionally indicated that 50-point rate increases are on the cards for the next few meetings. It’s funny how markets react – Chairman Powell indicated that the Fed isn’t “actively considering” bigger increases. The fact that they said they have a “couple more” hikes in the chamber was ignored.

The Indian silver bullet to the wheat export woes has taken a hit with reports that India is considering restricting exports due to the recent heat wave and subsequent impact on production.

It has been rumoured that Russia has seized grain reserves from Ukraine with indications that as much as 400,000t has been “stolen”.

Australia

Local markets were steady to slightly firmer yesterday as the delivered port value continue to lead the way. Liquidity remained fairly steady with offers hard to come by from the trade. Consistent prompt bids kept the nearby market elevated by $5-$10/t over the deferred. The massive logistical task weighs on the supply chain which is not expected to ease into the back end of the year.

The drawn-out sorghum harvest is almost complete. Moisture is causing some headaches and quality issues but prices are making up for it. The sorghum crop is still estimated to be one of the biggest produced since 2008-09. Forecast rainfall for today will not help crops that are yet to be harvested but will benefit winter crops.

Sowing in parts of Central West NSW is said to be out of action until early next week with reports of seed bursting and some resowing operations ramping up.

 

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