All grains prices were in the green again yesterday.
Corn prices rose 0.7%.
Soybeans saw much more modest gains of around 0.15%.
Chicago wheat contracts were up 1.7%.
Kansas wheat contracts, trended 1.98% higher.
Minneapilis wheat contracts added 0.88%.
Wheat prices jumped on a round of technical buying spurred largely by North American production concerns and relatively tight domestic and global supplies.
Operators anticipate a drop in the availability of the 8 major exporting countries in the next USDA report, out on September 30.
Spillover strength from Wall St. and a weakening U.S. Dollar lent additional support.
Corn prices ros on the ensuing spillover strength of high wheat prices, with further support from solid gains on Wall St. and in the energy sector.
Soybean prices inched slightly higher after some technical buying, supported largely by spillover strength from corn and wheat, with a solid round of export sales data from USDA lending some additional support.
On macro markets, oil prices rose on this morning for a fourth straight day due to global supply concerns following powerful storms in the United States, with China’s first public sale of state crude reserves causing a momentary blip in the rise.
Thus, Brent crude was up 12 cents, or 0.2%, at $77.37 a barrel, by 0321 GMT, after touching two-month high on Thursday and closing at its highest since October 2018.
U.S. oil was up 6 cents, or 0.1%, at $73.36 a barrel, having closed 1.5% in the previous session, the highest since the start of August.
On the financial side, yesterday the Dow Jones Industrial Average, the S&P 500 and the Nasdaq Composite all gained more than 1%, as investors appeared to take the Federal Reserve’s latest tapering signals in stride.
Indeed, the Fed said on Wednesday it could begin reducing its monthly bond purchases by as soon as November, and that interest rates could rise quicker than expected by next year, but the November deadline was largely priced in by markets.
Thus, the risk-on sentiment in stock markets weighed on the dollar.
The dollar index dropped sharply overnight against a basket of its peers, falling from its highest in nearly one month to a one-week low.
It was broadly steady in Asian hours, though it strengthened against the yen to its highest since Aug. 13.
Meantime, Asian shares were on edge on Friday, hurt by persistent uncertainty around the fate of debt-ridden China Evergrande, even as increased risk appetite drove U.S. stocks and Treasury yields higher.
Thus, on this morning MSCI’s broadest index of Asia-Pacific shares outside Japan was little changed after falling 0.7% this week, poised for its third weekly loss in a row.
Australian shares fell 0.4%, while the Hong Kong benchmark was mostly flat.
Japan’s Nikkei rose 2%, however, catching up with global gains after the market was closed for a public holiday.
Chinese blue chips reversed early losses to gain 0.3% after a cash injection from the central bank brought its weekly injection to 270 billion yuan ($42 billion) – the largest since January.
U.S. stock futures, the S&P 500 e-minis, were up 0.5%, while European stock futures and British stock futures , slipped.
Coming back on grains market, though agricultural markets seems quiet, they starting to look forward more aggressively to next week’s USDA stocks report on 30 September 2021 and the annual US small grains report on the same day.
On the weather side, there’s starting to be a rain system added to the western Corn Belt forecast for early October in the latest model runs bringing chances of 2-3″ across Kansas/Nebraska/South Dakota and the western edge of Iowa and Missouri.
However harvest continues to rip along there, with good weather in the meantime.
Meantime, weekly export sales figures were reasonable.
Wheat export sales were 0.35 million tonnes (Mt), beans 0.9Mt, corn 0.4Mt and milo/sorghum had two new crop boats sold to China.
A new season corn sales flash 0.138Mt to Guatemala was reported yesterday by USDA.
Note wheat exports tumbled 42% lower week-over-week but stayed 1% above the prior four-week average.
In this context, corn basis bids jumped 25 cents higher at an Iowa processor and were variable across Midwestern ethanol plants while holding steady elsewhere across the central U.S..
Soybean basis bids rose 4 cents higher at an Indiana processor while dropping 10 cents at an Iowa processor while holding steady elsewhere across the central U.S..
From South America, Argentina corn planting areas are estimated at 8.5%.
Unlike Brazil, beneficial rains are observed in the country.
However, IHS Markit Agribusiness raised its forecast for 2021/22 Brazilian soybean production, which is now at 5.328 billion bushels.
On European market, further price increases on all products, particularly in a context of major technical areas breaking out on Euronext.
Thus the resistance of the € 250 / t maturity December in wheat on Euronext has been crossed, leaving the door open to further increases.
The courses thus come to register at the highest since August 16 on this deadline.
Demand on the international scene is unabated, straining the balance sheet a little more.
In fact, an acceleration of port activity in France is reported, destined for China and the Maghreb.
Driven by the tension in the wheat market, European corn also increased its gains.
Rapeseed post new highs in the wake of canola, continuing to beat records after records with a November contract which fetched € 615 / t!
The strong tension in the European market is also driving the entire oil seed complex up, including soybean oil in Chicago.
From the Black Sea basin, rumors point to new export restrictions that Russia could impose in view of the sustained activity in this area since the start of the campaign, despite the introduction of taxes.
However, wheat prices stagnated yesterday in the Black Sea basin thus not following the progression on the other places, which allows them to find a little competitiveness.
In corn, however, close prices started to rise again in a context of tension linked to the delay in harvests.
In fact, the rains in Ukraine are delaying the construction sites.
From a geopolitical point of view Boris Johnson met Zelensky to discuss the development of the Ukrainian defense fleet.
From Australia, its expects a very good wheat harvest to come and could export to China, despite geopolitical tensions between the two countries.
Meantime, markets were slightly firmer yesterday, tracking the global moves with little news on the domestic side in quiet trade.
A few new farmer sales are trickling out but most looking forward to harvest.
Also Australian canola is pushing to new highs with the global rally.
Internationally, the IGC revised upwards its estimates of the world maize harvest from + 7 million tonnes to 1.209 billion, notably by increasing those of the USA and Ukraine.
The IGC, indeed, revised upwards its estimate of maize production for the USA to 380.3 million tonnes against 374.7 previously estimated and compared to 380.9 million by the USDA.
In wheat, world production is revised up from 1 million to 781 million.
Meantime, the international demand is strong.
Algeria would have bought a little more than 500,000 t of durum wheat at the extremely high price of $ 630 / t C & f!
If the origins are optional, it is likely that Mexico was among the main suppliers.
The grain is for shipment in November.
Taiwan is said to have bought nearly 50,000 t of milling wheat from the USA.
The grain is for shipment in November.
Pakistan purchased more than 21 million bushels of wheat from optional origins in an international tender that closed earlier this week.
The grain is for shipment between November 11 and December 30.
As expected, Jordan issued a new international tender to purchase 4.4 million bushels of milling wheat from optional origins, which closes September 29.
Jordan passed on all offers for a similar tender that closed yesterday. The grain is for shipment between January and March.
We wish you a good day.
