Markets

Daily Market Wire 9 April 2020

Lachstock Consulting, April 9, 2020

Wheat and canola markets firmer, corn and beans dithered.

  • Chicago wheat May contract down US1¢/bu to 548.25¢;
  • Kansas wheat May contract up 4.75c to 473.25¢;
  • Minneapolis wheat May contract up 5.5c to 530¢;
  • MATIF wheat May contract up €1.75/t to €197.25/t;
  • Corn May contract down 1.5c/bu to 330¢;
  • Soybeans May contract down 0.25¢/bu to 854.5¢;
  • Winnipeg canola May contract up $C1.80 to $462.30/t;
  • MATIF rapeseed May contract up €1 to €371/t;
  • Brent crude June contract up US$0.97 per barrel to $32.84;
  • Dow Jones index up 779 points to 23433;
  • AUD firmer at $0.6235;
  • CAD firmer at $1.4010;
  • EUR weaker at $1.0861.

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Markets

Finally – Minny leads the day, closing up 5.5¢ to 530¢, KC +4 3/4¢ to 478¢, Chicago off a penny to 548 1/4¢, and Matif +1.75€ to 197.25€ on the earlier close.  Row crops were quiet with corn back a cent and a half to 330¢ and beans off a quarter cent, while canola was firmer across the boards – Winnipeg up a buck eighty to $462.3 and Matif +1€ to 371€.

Crude oil was off a bit earlier with the stocks build and deal pessimism – but now the talk is back towards an agreement (though as always this is currently only sentiment and not action) with WTI trading out at $25.1/ Brent $32.8.  Stock markets have picked up (+779 points on the DOW) as markets look at case/hospitalization figures in New York and begin to see some stabilization there (though deaths continue to climb) – the world’s a long way from past the virus, but if Wall Street can eventually reopen markets are likely to remain optimistic.  More stimulus talk doesn’t hurt anything either.  Meanwhile, French lockdown extensions have now gone into indefinite mode and there are more cases spiking in new locations – Indonesia and parts of Africa becoming the newest hotspots.

Oil price, corn/ethanol damage

We also have the OPEC/Russia meeting coming later today (late night Aus time) – can differences be resolved there?  With the US off the table so far (although there have been some indications of support) there’s a lot of scepticism that a large cut deal can be reached, but they are trying.  The lower oil prices have already done significant damage to the corn/ethanol industry though – with the latest weekly figures cut production nearly another 170kbd and inventories are 11% over prior record highs.  Plant shutdowns (and purchase washouts) continue, and with coronavirus lockdowns cutting into gasoline demand there are many questioning if ethanol crush can pick back up even with higher crude prices.

Beans talk

There’s been more discussion about Chinese government bean releases the other day, with spot shortages reportedly still around given the delays in SAM shipments.  The Brazilian stem is as deep as ever, but some of the recent logistical joys have slowed the arrivals to China.  Brazilian ports reportedly working as per normal still (despite the expanding coronavirus situation), so crushers there are hoping this will be a temporary problem and resolved shortly – but still some risk of it continuing.  We haven’t seen any new flash sales from the USDA (which arguably should have happened earlier for more PNW boats if they were not expecting government bailouts ….), but if problems expand in Brazil that’s the stop-gap option.  Certainly nothing yet in line with the implied imports needed to meet trade war agreements….

Australia

Back locally, the weather maps are starting to push some better chances of 20+mm of moisture later next week for the WA wheat belt – which would be just perfect pre plant timing if realized.  Markets relatively quiet going into the long weekend – have a Happy Easter all.

 

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