As all Australian states bar Queensland and Western Australia observed the Queen’s Birthday long weekend, you could be forgiven for forgetting COVID was a thing. Pubs and clubs were, in some fashion, open and the public was clearly very keen to get back out. Reports of beachside towns seeing near full occupancy clearly indicated that people are sick of seeing the inside of their houses. However, global numbers clearly show the pandemic is far from over. India posted another single-day high for the country, which is concerning given it is due to reopen many shopping malls and religious venues. Brazil is leading the charge on daily infection rates with 27,075 people contracting the virus yesterday.

The big move overnight was the AUD, which has now returned to pre-COVID levels and completely retraced the down move. Financial markets are somewhat baffling; the US is now officially in recession, while the Dow Jones Index continues to make new highs. Amazingly, the US added jobs in its latest non-farm payroll release. This shocked the market, which was looking for another healthy round of job losses. This puts the unemployment rate at 13.3 per cent, which adds some support to the idea that the massive cash injection in the US is doing the job. This stimulus package has pressured the USD, while the Australian market still wards off moving to negative rates. The result is a continued widening of the yield profile between Australia and pretty much all of the majors.

Another cold morning through Victoria, southern South Australia and southern New South Wales has seen temperatures slide below zero. This will start to check growth rates in established crops. Rainfall has appeared on the 8-15 day forecasts, covering almost all of the national cropping outbelt. Northern NSW and the western side of the Great Southern region in Western Australia will record the highest falls of up to 50 millimetres, although the majority of this expected moisture is still in the back end of the forecast. Markets finished the week a fraction stronger on Friday, showing some strength on new-crop to claw back what it had lost during the week. East-coast ASX January contracts settled the week at AU$302 per tonne wheat and $225/t for barley. Domestic bids and offers pushed higher on the boards through new-crop, while old-crop values tick along relatively unchanged. Post the rally in the AUD, we expect to see values start the week a little softer.