Grain prices continued to move higher in Chicago, on another round of technical buying inspired by tightening domestic and global stocks.
Wheat prices saw the most upside, with some contracts climbing more than 2.5% higher by the close.
Corn prices also rose more than 1%.
Soybeans stayed in the green, but gains were more muted.
On macro markets, energy futures were narrowly mixed.
Crude oil saw fractional cuts.
Diesel and gasoline saw small gains, in contrast.
Better-than-expected earnings reported by General Motors and others, lifted investor confidence so, on Wall St., the Dow climbed 97 points trading to 34,230.
The U.S. Dollar firmed slightly.
Coming back on grain markets, corn prices moved even higher as traders sharpening their focus on tightening US and global stocks.
The weekly production of ethanol is displayed at 952,000 barrels / d against 945,000 last week and stocks are up to 20.4 million barrels against 19.7 million last week.
Soybean prices followed corn and wheat prices higher, but struggled a litle bit.
Wheat prices racked up significant gains on some weather woes in the Southern Plains coupled with worries over tightening supplies, which spurred a round of technical buying.
Some additional moisture could land on the central U.S. to 0wrap up the week, but not much more than 0.25” will be likely in most areas between Thursday and Sunday, per the latest 72-hour cumulative precipitation map from NOAA.
In this context, corn basis bids were mostly steady but mixed across a handful of Midwestern locations Wednesday, moving as much as 6 cents higher at an Illinois river terminal and falling as much as 4 cents lower at an Iowa processor today.
Soybean basis bids did jump 25 cents higher at an Indiana elevator and firm 5 cents higher at an Iowa processor.
US farmer sales have been generally slow.
However, the general sentiment is few are holding onto any significant old-crop supplies at this point.
Operators will be watching next week’s USDA report with interest, especially with the new corn production estimates for Brazil.
From South America indeed, weather wise, it’s more of the same news.
There’s no rain forecast for Brazil, entering the dry season.
Consequentially, brazilian consultancy Datagro is now estimating the country’s 2020/21 corn production at 4.152 billion bushels, falling 3.5% below its prior projection.
The country has struggled through some overly dry conditions in recent weeks.
Meantime, they slightly raised its estimates for the country’s 2020/21 soybean production from its prior projection, moving it to 5.010 billion bushels.
That’s on the higher end of the current range of production estimates, although nearly all projections call for at least 4.8 billion bushels this season.
On European market, the rains expected in France today could be disparate and disappoint in many regions.
The other European countries suffer from less water deficit than France for the moment.
Risks to Brazilian production continued to drive also european corn prices.
Corn prices indeed, continues to soar in particular with an eighth consecutive session in the green and a close contract which now exceeds € 250 / t!
Wheat follows in their wake while rapeseed sets new maturity records.
In add, the surge in corn is also reviving the interest of Asian buyers in feed wheat.
Rapeseed prices, on their part continue to advance, on the wake of new highs posted in Canada now for canola.
The prize this morning is not to be outdone, increasing by + 3 to 4% depending on the deadlines.
Meantime, the latest data from the European Commission indicates that EU corn imports during the 2020/21 marketing year have reached 12.34 million tonnes against 17.67 last year to date.
That’s a year-over-year decrease of 30% so far.
European Union soybean imports for the 2020/21 marketing year are trending fractionally above last year’s pace after reaching 453.4 million bushels through May 2.
EU canola imports at 5.43 million tonnes against 5.30 million last year to date, are also up slightly year-over-year, with EU soymeal imports down moderately during the same period.
European Union soft wheat exports for the 2020/21 marketing year are 665,000 t in April, bringing the total to 22.14 million tonnes since the start of the campaign against 30.0 last year to date.
EU barley exports are roughly even from a year ago, meantime, with 6.61 million tonnes.
Port activity, however, is currently reduced for the French origins, with its 2 main buyers, namely Algeria and Morocco, showing little interest at the end of the campaign.
Wheat production in Morocco for the next harvest looks promising.
The publication of the COT by Euronext yesterday shows that the financiers have increased their long positions in wheat to 133,450 lots against 120,471 lots last week.
From Black Sea basin, a rainy disturbance is developing over the Black Sea.
The first rains are expected for the end of the day.
Most of the precipitation is expected for the weekend with accumulations that could appear beyond 50mm as in the case of the Rostov region.
Once again, these disturbances could impact the progress of seedlings, which for the record is at a rate at the lowest of the last 7 years.
The rapidly worsening health crisis in India, continues to threaten global demand in the near term.
However, as India grapples with COVID the government announced it will provide free food grains (wheat and rice) to 800 million people.
Back of envelope this equates to 8 million tonnes (Mt) of grains.
Luckily, India currently has near record inventories.
In Australia, fantastic rains were received through the WA cropping belt with totals up to 60mm, most areas got 20 plus mm.
Growers are having a great start to the season with rainfall totals for the past 60 days nudging 100+mm
New crop Australian wheat markets remained relatively steady on the boards yesterday.
WA Kwinana zone APWMG grower bids were up $4-5/t to finish out around $345 FIS while across the east coast, the ASX Jan 22 wheat market settled down $4/mt from the previous trading to finish at $317/mt.
Grower multi-grade bids were around the $320/mt track mark, Geelong/Melbourne.
New crop canola markets rallied again with bids in WA and the east coast up $8-10/t.
There are reports of some re-sowing of canola starting to happen through southern NSW, as mice are still very active in that part of the country and growers are also hoping for another rain event.
On the international trade scenario, private exporters announced two more large corn sales to USDA yesterday.
The first was for 7.2 million bushels for delivery to Mexico during the 2021/22 marketing year, which begins September 1.
The second was for 5.8 million bushels to unknown destination.
Of that total, 1.8 million bushels is for delivery in the current marketing year, with the remaining 4 million bushels for delivery in 2021/22.
Cancellations for 5.5 million bushels of corn for delivery to China were also reported yesterday.
Taiwan issued an international tender to purchase 3.3 million bushels of grade 1 milling wheat from the United States, which closes May 13.
The grain is for shipment between early July and early August.
The Philippines purchased 2.2 million bushels of wheat at A$338/t, from optional origins but the delivery is Geelong terminal.
The grain is for shipment between June and July.
Tunisia bought barley and while it wasn’t necessarily Aussie origin it works back to, once again, rough and dirty, A$275/mt delivered Geelong terminal, again smack on the current market.
Tonight we will see how the sessions will close.
