Yesterday was a quiet day with US markets closed for their Memorial Day long weekend.
In pre-opening, this morning, it is the firmness of prices that predominates, all products.
Chicago corn futures are bouncing back, climbing 1.5%, while wheat are rosing more than 2% as concerns over North American weather and strong Chinese demand, that are underpinning prices.
Soybeans are gaining more than 1%, rising for two out of the last three sessions.
There is dry weather in the United States and Canada, consequently there are some doubts around wheat crop in Canada and U.S. corn yields.
However, large speculators cut their net-long position in the Chicago Board of Trade corn futures in the week to May 25, regulatory data released on Friday showed.
The Commodity Futures Trading Commission’s weekly commitments of traders report also showed that non-commercial traders, a category that includes hedge funds, increased their net-short position in CBOT wheat and cut their net-long position in soybeans.
On macro markets, Brent was quoted as USD $ 0.62 / bbl higher.
The WTI crude oil, this morning progresses posted at 67.60 usd barrel over New york as demand is increasing in the USA with the so-called driving season.
The dollar appears this morning at 1.2230 against the euro and 73.30 against the ruble.
The yuan lost ground against other currencies as China’s central bank required banks to keep a larger portion of their foreign exchange reserves.
The hike, from 5pc to 7pc, effectively reduces the amount of dollars and other currencies available in the country.
The measure aims to contain the yuan’s rising value, which has been fueled by a strong post-lockdown economic recovery.
Meantime, China’s top decision-making body announced that the government would raise the two-child limit to three, only weeks after a census revealed that the country’s population was on the verge of a historic turning point after decades of fast expansion.
The Organization for Economic Cooperation and Development increased its global economic growth prediction for this year from 4.2 percent (pc) to 5.8pc.
GDP will return to pre-pandemic levels in most regions by the end of 2022, thanks to a 4.4pc expansion next year.
The club of primarily wealthy nations recommended governments to shift their focus away from short-term stimulus programs and towards long-term investment plans.
In May, annual inflation in Germany rose to 2.4pc, up from 1.9pc the previous month and far higher than economists had predicted.
The central bank of the country anticipates that inflation will “temporarily approach 4pc” by the end of the year, the highest level since the country adopted the euro in 2002
Coming back on grains market, european prices regained a little height on Monday, at the end of a session, however, not very active in the absence of Chicago.
Matif milling wheat was EUR $ 2.75 firmer, French canola was EUR $ 4.50 lower and EU corn was EUR 1.50 higher.
Wheat prices started to rise again yesterday in a context of sustained demand on physical markets, especially internationally as Saudi Arabia bought 562,000 t of wheat at an average price close to 300 usd / t delivered over the August / September period.
However, should be to note, that the tender was initially for 720 kt.
The origins are optional and could turn largely to Germany and the Baltic countries.
Meantime, Algeria also have bought around 200,000 t of durum wheat.
Corn prices also continued to rise in the face of a lack of availability before the arrival of new harvests.
Harvest delays in Argentina and reduced production prospects in Brazil are further straining the European market in the medium term.
Rapeseed, on the other hand, gave in to the withdrawal of Malaysian palm and Canadian canola.
The rapid deterioration of the health situation in a large part of Asia is indeed starting to reduce exports of vegetable oil to the region.
However, should find support this morning in the rise in soybean prices in the pre-opening.
From a meteorological point of view, meantime, in western Europe the rise in temperatures is welcome.
Also from Black Sea basin, grain prices started the week on the rise again, while climatic conditions remain rather favorable, with the exception of the water deficit still in central Russia.
Indeed, russian agriculture consultancy Sovecon said on Friday it had downgraded its forecast for Russia’s 2021 wheat crop to 80.9 million tonnes from 81.7 million tonnes due to smaller winter wheat area and worsening weather for spring wheat.
From Ukraine, the week will be agricultural at the Ukrainian Rada which will examine this week 5 bills related to agriculture.
The first concerns materials that may come into contact with food, the second concerns the registration of animals, the third concerns the import of phytosanitary products, the fourth concerns the operation of the guarantee fund and the last concerns management. of land on the eve of the liberalization of the Ukrainian land market with a first component on July 1, 2021.
In China, the winter wheat harvests have started and are posting yields considered to be fair for the country.
Meantime, China’s National Health Commission said on Tuesday that it had confirmed one case of human infection with the H10N3 strain of bird flu in Jiangsu province.
The case, detected in a male aged 41 living in Zhenjiang, a city in the eastern province, was transmitted from poultry, and the risk of spreading on a large scale was very low, according to a statement on the website of the commission.
There has not been any case of human infection of H10N3 reported in the world before, NHC said.
India is likely to receive 101% rainfall of a long-term average this year, the weather office said, upgrading its previous forecast and raising expectations for higher farm output in the country, which is reeling from a second COVID-19 wave.
The monsoon is expected to be well distributed, and most parts of the country are expected to receive an average to an above-average amount of monsoon rains in 2021, Mrutyunjay Mohapatra, director general of the state-run India Meteorological Department (IMD), told a news conference.
The IMD defines average, or normal, rainfall as between 96%and 104% of a 50-year average of 88 centimetres for the entire four-month season beginning in June.
Meantime, India raised the base import price of palm oil, soybean oil, gold and silver.
The government revises base import prices of edible oils, gold and silver every fortnight and the price is used to calculate the amount of tax an importer needs to pay.
Commodity New price in $ are: crude palm oil 1,222 RBD; palm oil 1,245 RBD; palmolein 1,265; crude soya oil 1,452; Gold 612; Silver 890.
Base prices for all commodities are in $ per tonne, except for gold and silver.
Gold tariff is in $ per 10 grams and silver in $ per kg.
Aussie local markets started the week relatively unchanged on the boards for both old and new crop.
With end-of-month we saw some late trading activity on barley along the east coast with track values for May finishing firmer at around $ 250 / t through Victoria.
The wheat job was very quiet with wide bid offer spreads through the current and new crop markets, May APW1 track finished out the day around $ 310 / t in Victoria.
Areas through NSW remain patchy on germination with reports that canola is the crop that is most patchy and some resowing has accrued, with a below average rainfall for May for most parts of SA and VIC and Southern NSW we now need an average June to help align the crop with some of its subsoil moisture that is about.
Weather models have now improved for the next 8-15 days with increased precip for SA, Western and North Eastern Victoria areas.
While in theNorthern NSW and Centrals NSW are set for 10-15mm event which will also push across into the border regions of NSW and Qld.
Tonigth we will see how the sessions close.
