Wheat markets finished in the green post their 3-day weekend. This is a busy period of the year with row crop weather the first and foremost driver. Corn has something for everyone but, for the moment at least, the bulls are focused on the dryer-than-normal outlook for the heart of the belt with some increased heat to boot. The weather event needs to be put into context with positioning. Funds are short and, should the weather deteriorate, they may choose to exit. If market moves were based purely on fundamentals it would be hard to see corn fighting higher with a 2.7bbu carry out tied around its neck. Beans however can tighten quickly. Clearly a lot of moving parts when your biggest off-take destination is the same country with which you have an ongoing and multi-faceted argument.

Global weather has a few interesting developments. It’s falling short of a disaster but still worth watching. Argentina’s wheat belt remains dry. Over the last 2 months a large percentage of the planted area has only received around 20pc’ of normal rainfall. The next 15 days’ forecasts offer some relief but not for the hardest hit country. The US corn belt is also falling behind normal precipitation in some areas; again, not a disaster just yet but with some higher temps in the forecast the market is paying attention. We are also watching the much anticipated forecast Queensland rain event which has lost some of its sting in the updated runs this morning. There’s still moisture in the forecast.

Aussie domestic markets started the week off basically unchanged from both an old and new crop perspective. ASX east coast wheat Jan contract traded yesterday with a small volume going through at $290-291/t levels. However, 20/21 canola bids were softer by $3-4/t. Barley bids and offers remained wide. Worth noting that there are at least 2-3 barley cargoes heading to Thailand now according to the latest LSC Australian Export Vessel Lineups report. Barley shipments to Thailand have now hit 100,000t for the last two weeks which is well above normal.

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