Today’s report is truncated given the US Labor Day holiday Monday.
On Euronext corn lost 0.7% yesterday.
Wheat fell 0.9%.
Rapeseed rose 0.3%.
On macro markets, oil prices were mixed on this morning as some investors scooped up bargains following recent losses.
Meanwhile, state oil group Saudi Aramco notified customers on Sunday that it will cut October official selling prices (OSPs) for all crude grades sold to Asia by at least $1 a barrel, sparkeingfears over slower demand and weighed on sentiment.
Additionally, markets are also contending with a decision by the OPEC+, to raise output by 400,000 barrels per day a month between August and December.
Thus, Brent crude futures for November rose 35 cents, or 0.5%, to $72.57 a barrel by 06:54 GMT, after falling 39 cents on Monday.
U.S. West Texas Intermediate crude for October was at $69.16 a barrel, down 13 cents, or 0.2%, from Friday’s close, with no settlement price for Monday due to Labor Day holiday in the United States.
On the financial side, global stocks inched higher on Tuesday, as investors wagered the U.S. Federal Reserve is likely to delay the start of tapering its asset purchases after the soft U.S. jobs data.
In fact, the world’s shares, measured by MSCI’s gauge of 50 markets, tacked on 0.1% to log its eighth consecutive day of gains to record highs.
Tokyo’s Nikkei rallied as much as 1.3%, moving past the psychological barrier of 30,000 for the first time since April.
Japanese shares extended their bull run on hopes the ruling Liberal Democratic Party will compile additional economic stimulus and easily win an upcoming general election after the country’s unpopular Prime Minister Yoshihide Suga said he would quit.
Mainland Chinese shares were little changed in early trade while MSCI’s ex-Japan Asian-Pacific index was down 0.1%.
On the other hand, European stocks, hovered below record highs on Tuesday as caution ahead of a European Central Bank meeting later this week offset gains in the telecoms sector following a Deutsche Telekom deal.
The pan-European STOXX 600 index slipped 0.1% by 07:19 GMT.
Coming back on grain markets,
From South America, according to the AgRural agriculture consultancy, Brazil’s 2020/21 total corn crop is now expected to reach 81.9 million tonnes, more than 20 million tonnes below last year’s harvest.
Most of the cuts were made to Brazil’s second corn crop, currently being harvested, which is now seen at 55.6 million tonnes, versus 75.1 million tonnes in 2019/20.
Harvesting reached 95% as of Thursday, AgRural said.
For Brazil’s 2021/22 first corn crop, AgRural said that planting in the Center-South region reached 10% as of Thursday, up 5 percentage points from the previous week but 4 points behind last season.
On European market, Monday’s session on Euronext remained particularly quiet in Chicago’s absence.
The crumbling both in European wheat and corn, is due in large part to the FranceAgriMer statement that a big proportion of wheat that did not meet the qualitative criteria for export.
Corn prices also remain under pressure in the face of the expected arrival of Ukrainian harvests at a record level.
European rapeseed for its part resumed its bull market in the wake of the Malaysian palm.
The country’s production has indeed fallen sharply since the beginning of September, while exports are picking up quickly.
Meantime, Strategie Grains rose its corn production estimates to 66.3mT.
They lowered its world wheat estimates to 750.3mT.
They also lowered monthly estimates for oilseed crops in the European Union’s 27 member, with rapeseed now at 16.93 million tonne, sunseed at 9.63 and soybean at 2.66 million tonne.
On the other hand, according to the growers group AGPB, French soft wheat production is expected just under 36 million tonnes this year, up 23% from last year, said on Tuesday.
However, they also said grain quality in the rain-affected harvest was very mixed.
From the Black Sea basin, Russian Grain Union also decreased its wheat production forecast from 82-83mmt to ‘more than 75mmt’.
In this context, Russian FOB prices remain very strong, close to 300 usd / t, export taxes included.
Meantime, export activity remains dynamic with wheat exports from Russian origins stand at 1.7 million tonnes from August 27 to September 2, compared to 1.6 million tonnes the previous week.
On the other hand, Kazakhstan will increase purchases of Russian grain to cover demand from neighbors that suffered from drought.
To note, as border between Russia and Kazakhstan is open these volumes will not be included into statistics and could be used to explain why there is less wheat in russia than ministry expects.
Meantime, there are rumors that Kazakhstan could supply ~7mmt of wheat to Iran in 21/22, partly Russian origin.
From the Middle Kingdom, China’s soybean imports fell in August from the same month a year ago.
Indeed, China, bought in 9.49 million tonnes of the oilseed in August, slightly down from 9.6 million tonnes a year ago.
Low crushing margins and high international bean prices weighed on demand.
However, August imports were up 9.5% from 8.67 million tonnes in July, according to the data.
Crushers in Rizhao, Shandong province, a major soybean processing hub in northern China would lose about 80 yuan ($12.40) for each tonne of soybean processed.
China’s hog margins have plummeted since the start of the year and stayed at low levels on tumbling pork prices.
Indeed, hog margins in Sichuan, were at negative 200 yuan.
($1 = 6.4545 Chinese yuan renminbi).
In this context, soybean shipments in the next few months are not expected to spike as China built up ample supplies earlier in the year, while hog margins should remain low.
From Australia, ABARES released their September crop estimate overnight on Tuesday, 7 September 2021.
Wheat production is therefore expected at 32.63 million tonnes against 27.8 estimated last June and close to last year’s record of 33.34 million tonnes.
Barley production is expected at 12.5 million tonnes against 10.4 estimated in June.
Canola harvest is expected at 5.03 million tonnes against 4.2 posted in June.
The Aussie continent benefited again this year from a favorable climate under the effect of La Nina.
These are strong numbers and is a big jump up from their last report in June.
USDA WASDE is out on Friday this week, 10th of Sep.
The USDA was 30 million tonnes (Mt) in their last report for Australian wheat production.
We would expect they adopt this ABAREs number this week in their September report.
Meantime, markets were slow going by the day end, wheat new crop values were off $3-5/t across the boards while barley bids pulled back $3-5/t but offer side remained unchanged therefore left the day finished out very wide markets across the east coast.
Weakness in markets came off the back of good rainfall through large parts of NSW and Victoria along with a stronger AUD at .7438 across most of the trading day.
On the international scene, Jordan is buying 120,000 t of feed barley.
Possible shipment combinations of 60K are Dec. 16-31, 2021, and in 2022 between Jan. 1-15, Jan. 16-31 and Feb. 1-14
The deadline for submission of price offers is Sept. 9.
Algeria’s state grains agency OAIC has issued an international tender to buy a nominal 50,000 tonnes of animal feed barley to be sourced from optional origins.
Bangladesh issues tender to buy 50,000 tonnes wheat.
The closing date is for Sept. 16, 2021.
We wish you a good day.
