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Daily market wire 8 January 2018

by Lachstock Consulting, 08 January 2018

Friday’s futures markets:

Lower for grains, higher for oilseeds.

  • CBOT wheat  down -3.25c to 430.75c,
  • Kansas wheat down -2.25c to 437.5c,
  • corn up 0.25c to 351.25c,
  • Soybean up 3c to 970.75c,
  • Winnipeg Canola down -0.69$C to 498.2$C
  • Matif canola up 0.5€ to 358.25€.
  • The Dow Jones up 219.84 to 25294.98,
  • Crude Oil down -0.41c to $61.59 per barrel,
  • AUD up to 0.78716c,
  • CAD down to 1.241c, (AUDCAD 0.977)
  • EUR was down to 1.20408c (AUDEUR 0.653).

Wheat

Wheat finished lower in both winter classes, with poor weekly export sales (total 131,000t) discouraging the bid side of the market. Despite the quiet holiday trade, these sales were poorer than expected coming in 27 per cent below the same week last year.

Matif futures finished up €0.50/t. The Algerian tender is working, with submissions revealing that US wheat is too high by approx. US$13/t.

The Commitment of Traders (COT) report in wheat changed as follows: Soft Red Winter wheat +17,500 to -128,200 contracts; Hard Red Winter +5,300 to -29,500 contracts; Spring wheat unchanged at +1,800 contracts. Implied volatility in March SRW went out at 19.6pc.

The market will now look to index fund rolls this week and the USDA report on the 12th.

Corn

Corn finished fractions higher in a US 2 c/bu range session. Like wheat and beans, weekly export sales were well below expectations, coming in at a meagre 101,000t. The corn COT came in at -198,500 contracts, with funds covering 8,700 contracts for the week.

Soybeans

Soybeans managed to finish higher, despite lower-than-expected weekly export sales. The figures came in at 553,000t vs. expectations of approximately 750,000t. Despite this they were still well above the same period last year. The dry Argentine forecast supported meal that finished up US$2.10/t, while oil finished down 9 points. The COT report revealed a 16,400 contract increase in the fund short position, which came in at -85,500 contracts.

Canola

Canola ended the week with mild losses, after testing the Can$500/t resistance level, despite meal strength and strong Canadian export data. The real driver here was the stronger Canadian dollar, which rallied 0.58pc on impressive jobs data.

Australia

Aussie market is still lacking direction, with the AUD throwing a spanner in the works for exporters and producers.

Wheat is very quiet with the only real demand coming from immediate spot requirements.

Barley remains strong, thanks to a large sold position into China as well as good ongoing demand. Appears that we are heading for an inverse in barley as track/bulk shorts bid Jan over March to cover nearby commitments.

Source: Lachstock Consulting

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