US farm markets were mixed but mostly lower yesterday.
Corn prices were moderately higher gaining 1,01% by the close, as traders eyed some rain delays earlier this week.
Soybeans tried to follow suit but ultimately failed and closed steady to up slightly by 0,06%.
Also wheat prices were negatively affected yesterday by a round of profit-taking, thus most contracts had moderate losses.
Indeed, December Chicago SRW futures fell 0,95%.
December Kansas City HRW futures dropped 0,06%.
December MGEX spring wheat futures were 0,53% lower.
On macro markets, oil prices fell on this morning after industry data showed crude oil stockpiles rose more than expected and fuel inventories unexpectedly increased last week in the United States, the world’s largest oil consumer.
Indeed, crude oil inventories rose 2.3 million barrels in the week ending Oct. 22, market sources citing American Petroleum Institute figures said late on Tuesday.
That was more than the expectations for a 1.9 million barrel gain.
Gasoline inventories rose by 500,000 barrels and distillate stocks increased by 1 million barrels, compared with a forecast for both to drop.
Thus Brent oil futures fell 94 cents, or 1.1%, to $85.46 a barrel by 06:54 GMT after closing at the highest in seven years on Tuesday.
West Texas Intermediate (WTI) futures declined $1.02, or 1.2%, to $83.63 a barrel after gaining 1.1% in the previous session.
With Brent rising the past eight weeks and WTI climbing for the past 10 weeks, prices are starting to look overbought, analysts said.
On the financial side, on Wall St., the Dow added another 16 point, strading to 35,757 as General Electric and others contributed more better-than-expected earnings reports.
Tech stocks also made inroads, with Nasdaq gained 9,01 point closing at 15.235,72.
The S&P cloed at 4.574,79, gaining 8,31 points, meantime.
On the other hand, China stocks fell on this morning, led by coal firms after Beijing’s latest move to address skyrocketing coal prices, while environmental protection-related shares rose on the country’s plans to hit a carbon emission peak before 2030.
Thus, the blue-chip index ended down 1.3% to 4,898.16, while the Shanghai Composite Index lost 1% to 3,562.31 points.
Hong Kong shares closed lower, dragged down by technology and healthcare firms, while elevated short-term Treasury yields potentially drained liquidity from the market.
Thus, the Hang Seng Index fell 1.6% to 25,628.74, while the China Enterprises Index closed 1.8% lower at 9,093.80 points.
The Nikkei slipped less than 8 points to close at 29,098.24, maintaining most of the previous days surge of about 500 points.
Coming back on grains market, more rains are on their way to the Midwest and Plains this week, with some areas gathering another 2” or more between Wednesday and Saturday, per the latest 72-hour cumulative precipitation map from NOAA.
The agency’s latest 8-to-14-day outlook, covering November 2 through November 8, predicts a shift to seasonally cool weather for the central U.S., with a return to drier-than-normal conditions for the Midwest and Plains.
US row crop harvest confirms market yield ideas, meantime.
Good yields are being reported where it is not rain delayed but await further confirmation.
In USDA’s latest crop progress report, out late Monday afternoon, the agency marked the 2021 corn harvest moving from 52% a week ago up to 66% through October 24.
Analysts had expected USDA to report progress of 65%.
Harvest pace remains very swift compared to recent years – the prior five-year average is 53%.
The 2021 soybean harvest, on its part, is maintaining solid forward momentum, moving from 60% last week up to 73% through Sunday.
That’s well behind 2020’s pace of 82% but still moderately ahead of the prior five-year average of 70%.
Winter wheat plantings, on the other hand, reached 80% through Sunday.
That’s up from 70% a week ago and identical to the prior five-year average.
And 55% of the crop is now emerged, up from 44% a week ago but behind the prior five-year average of 59%.
Analysts significantly missed the mark on crop quality, with USDA reporting 46% rated in good-to-excellent condition in its first assessment of the season.
The average trade guess was much higher, at 54%.
Another 34% of the crop is rated fair, with the remaining 20% rated poor or very poor.
On the demand side, private exporters reported two large soybean sales to USDA yesterday morning.
The first was for 199k mt to China, and the second was for 0.126k mt to Mexico.
Both sales are for delivery during the 2021/22 marketing year, which began September 1.
Ongoing rumours suggest more bean cargoes were being booked from the US again last night which would result in flashes on this morning.
In this context, corn basis bids moved 5 to 28 cents higher at three interior river terminals, but tilted 10 cents lower at an Iowa processor. Most other Midwestern locations held steady.
Soybean basis bids showed wide variability, jumping as much as 42 cents higher at an Iowa river terminal while dropping as much as 10 cents at two Midwestern processors.
On European market, after a eventful session, Euronext yesterday finally finished in the green at the end of the day, driven in particular by the upturn in US corn.
Meantime, EU corn harvesting work is continuing even though it is lagging behind the average for the past 5 years while yields are displayed generally correct.
On this wake, per the latest data from the European Commission, EU corn imports during the 2021/22 marketing year have reached 4.10 million tonnes through October 24, against 5.40 last year.
That’s a year-over-year decline of 24% so far.
European union soybean imports during the 2021/22 marketing year have reached 3.87 million tonne through October 24, a year-over-year decline of 15% so far.
EU soymeal imports are also trending below last year’s pace, with 4.50 million metric tons.
European union rapeseed imports have reached 1.44 million tonne through October 24, a year-over-year decline of 31% so far.
Rapeseed, however, continued to gain momentum in the wake of canola, which set a new high yesterday in Canada.
Some operators are becoming a little more hesitant about current wheat price levels, at the highest since 2008.
Among the factors of uncertainty, the rebound in cases of covid all over the world, particularly in China and Russia, leaving doubts about the vitality and sustainability of the economic recovery.
In spite this, European wheat continued its bullish march in the face of still strong international demand.
Indeed, per the latest data from the European Commission, European Union soft wheat exports during the 2021/22 marketing year have reached 8.99 million tonnes as of October 24 against 7.23 million last year to date, which is a year-over-year increase of more than 24%.
EU barley exports are also trending above last year’s pace, with 2.86 million tonnes against 2.74 last year.
It should to note that France figures are still absent in EU Imports & Export data released by custom surveillance weekly.
From the Black Sea basin, weather maps continue to slightly improve for mid-November.
Better chances of an inch or so along the Volga are set to improve conditions for dry sown crops there.
Meantime, in Ukraine, 85% of soft winter wheat areas are estimated to be sown to date.
African Swine Fever has been reported again in Russia, the second such outbreak in the last month.
In this context, little change in prices yesterday, the physical activity being reduced.
From the Middle Kingdom, the Chinese authorities are imposing new obstacles on fertilizer exporters , ”the US Bloomerg news agency warned on 20 October.
“Several boats initially planned for India would currently be prevented from leaving in the ports of the Middle Empire”.
These shipments would be blocked by the local authorities to undergo additional checks , as part of customs regulations that came into force on October 15 and apply in particular to urea.
The China began during the summer to restrict its exports of fertilizers in the world in order to supply a priority its domestic market and contain the local price surge.
Consequentially, China’s restrictions on fertilizer exports continue to push up export prices of urea and DAP.
Global ammonia prices climbed once more as Europe heads into the winter heating season and natural-gas costs remain at near-record highs.
China between July and August exported 4.75 Mt of diammonium phosphate fertilizer and 2.93 Mt of urea to its main buyers (India, Pakistan, Southeast Asia), according to Reuters.
From Australia, extended run weather maps are solidly building up this new east coast storm system for mid November – latest runs upwards of 50 mm across central and northern NSW.
A few more frost concerns/reports coming in from south-eastern areas bringing worries about some damage in later cereals but markets still evaluating the impact.
Mosaic virus took edge off southern NSW wheat crops.
THE yield-sapping disease, wheat streak mosaic virus (WSMV), has taken its toll on wheat crops throughout southern New South Wales this season.
WSMV is a seed and mite-borne virus that causes severe leaf symptoms and reduced yields, particularly in wheat.
On the other hand, Aussie barley industry is making a concerted effort to sell malting barley parcels, large and small, into Latin America as harvest 2021 ramps up and Australian barley exporters enter their second year with China off the books.
Internationally, Egypt launched a call for tenders in wheat for loading December 1/10.
We wish you a good day.
