USDA’s Feb WASDE report will be released next Tuesday.
Meanwhile, regular US export inspections are out, with 1.1 million tonnes (Mt) of corn, 1.8Mt of beans, and 0.4Mt of wheat.
All were about as expected, and we also note the 191.000t of milo to China.
On the international market yesterday, we noted the sale of US corn to Mexico and Japan in respectively 125.730 t and 110.000 t, while 133.000t of soybean meal were sale to the Philippines.
However there was no new China business reported despite expectations.
There are still some speculation about more sales to come this week, but nothing concrete yet.
In the meantime, the European Union said that soft wheat exports have reached 14.99 Mt on Jan 31 vs. 18.02 Mt last year at the same date.
In barley, the exports were amounting to 3.92 Mt vs. 4.55 Mt last year to date.
Corn imports declined to 9.66 Mt vs. 13.3 Mt last year to date.
From Jan 1, the Commission is not considering UK figures anymore in its trade data.
In this context, markets were mixed overnight, with wheat mostly weaker and canola firmer.
Rapeseed prices, indeed, are underpinned by the good orientation of the canola that is dealing at its highest levels for last 13 years.
Carry over stocks in Canada could drop below 1 Mt.
Palm prices, on the contrary, this morning are retreating after India said its intention to raise import duties.
While soybean is finding support in delays observed in the Brazilian harvest due to heavy rains in the regions of production.
Brazilian soybean harvest, indeed, continues gradually to move along, but more and more reports of quality problems after the heavy rains are being reported.
It’s still a very slow pace compared with normal, and farmers chomping at the bit to get moving.
They are keeping a cautious eye on weather maps which have turned heavily wet again into next week for many central bean areas.
According to AgRural, the soybean harvest so far is not exceeding 2.5 million tonnes, compared to 11.7 million tonnes last year at the same date.
Such delays could create a supply gap between the US and South American crops and it could also affect second-crop (corn yields), as sowing are delayed.
Talking about corn, US exports corn to China are at record levels, confirming a Chinese appetite well above the latest USDA figures.
However, December ethanol crush figures in the US released last night, have seen corn use at 430 million bushels, almost unchanged from November, but still down ~10pc from a year prior.
Wheat prices declined yesterday as in Paris in Chicago.
Russia, indeed, is again at the centre of cereals traders’ attention.
Debates about the tax impacts continue and the new season tax formula clearly cuts into farmer revenue there.
Such a measure would then encourage producers who had intended to store their wheat until the new season to sell it off more quickly than expected.
Consequently, the country’s wheat export potential for the 2020/21’s season could be revised upwards in the event of such a decision.
Given the recent weakness in Matif, combined with the tax for Russian wheat that is putting down russian wheat export prices, Egypt’s GASC finally came back to the market, looking for LH March wheat.
In this tender, due to the current good competitiveness of the French origins, maybe, they will win at least for a part of the volume.
Payment will be made by letter of credit within 180 days.
Argentina is gaining momentum in its wheat exports after the strikes that affected shipments in recent weeks, pressuring market, however, the market is more mixed on current levels, and the level of 300 $/t FOB Black Sea looks to be a strong resistance.
An implement of russian floating tax on wheat export from June1, here, in fact, could represent 70% of the wheat FOB value above a threshold fixed at 200 $/t, i.e. 35 $/t at 250 $/t FOB or 70 $/t at 300 $/t FOB.
In the meantime, we must note that the dollar is firming up vs. euro at 1.2070, while is weaker vs. rouble at 75.80.
Aussie local markets remained firm yesterday on wheat, with more buying interest.
While barley has been holding flat and was canola mostly unchanged to off a dollar or two in spots after short covering activity slowed.
