Grain prices were mixed on Chicago yesterday.
Wheat contracts showed the most downside, with some contracts losing nearly 2% by on the close.
Soybeans saw more moderate losses, fading about 0.7% lower.
Corn prices were mixed, with May contracts falling more than 0.75% while July and September contracts trending higher.
On macro markets, Asia’s share markets were mostly higher today as regional equity investors are looking to signs of recovery from the coronavirus pandemic as major economies around the world reopen.
MSCI’s broadest index of Asia-Pacific shares outside Japan was up by 0.05% on the back of a positive lead from Wall Street overnight.
Hong Kong’s Hang Seng Index opened 0.3% higher at 28,441.95.
Australia’s S&P/ASX200 edged up 0.22% to 7,044.3 as the Reserve Bank of Australia is expected to keep the official cash rate on hold at 0.1% for May as it waits for further signs of the domestic economy’s rebound from the pandemic led downturn.
A statement following the decision at 0430 GMT will be monitored for indications whether the unprecedented quantitative easing programme there could start to be tapered.
Yesterday, Federal Reserve chairman Jerome Powell said the U.S. economy was doing better but was “not out of the woods yet” as the central bank prepared to release a study on the disparate effects of the pandemic on the country’s different demographics.
Japan and mainland China’s markets remained closed today for holidays dampening trading volumes across the region.
The brighter tone in Asian markets came after a stronger session on Wall Street.
Indeed, the Dow Jones Industrial Average rose 0.7% to end at 34,113.23 points, while the S&P 500 gained 0.27% to 4,192.66 with most of the gains concentrated in industrial and commodity shares.
The Nasdaq Composite dropped 0.48%, to 13,895.12 as technology stocks lagged stocks investors saw as beneficiaries of a pandemic recovery.
Energy stocks also gained on the back of higher oil prices.
Crude oil, indeed, gained (in U.S. trading) as easing restrictions in the U.S. and Europe raise hope of stronger demand.
In add, the European Union is planning to ease restrictions on vaccinated travellers over the summe.
In this context, energy futures jumped higher, with crude oil up 1.5%.
Gasoline and diesel were firmed by similar percentages.
The U.S. Dollar softened moderately.
Coming back on grain markets, corn prices were mixed amid some uneven technical maneuvering.
Nearby contracts (which are essentially traded as cash prices right now) fell 0.8%, while July contracts firmed more than 1%.
Soybean prices faltered, despite compiling overnight gains, as traders resumed a round of technical selling and profit-taking that left prices moderately lower by the close.
Wheat prices stumbled lower, following european prices lower and further pressured by spillover weakness from other grains.
The US weekly planting pace and condition report summary was as follows:
Winter wheat conditions were down 1pc to 48pc rated good-to-excellent;
Spring wheat was pegged as 49pc planted, a massive weekly gain of 21pc;
Corn was estimated as 46pc planted vs 36pc average and 17pc last week;
Soybeans are 24pc planted vs 8pc last week.
US weekly export inspections were within the soybean expectation range, but higher than the corn expectation.
Corn export inspections moved another 9.5% higher week-over-week.
Soybean export inspections stumbled 49.5% below the prior week’s tally.
Wheat export inspections slid 12% lower week-over-week.
In Brazil, drought still predominates and corn crops suffer at the dawn of the dry season, suggesting production for the country of less than 100 million tons.
Safras & Mercado has also cut its harvest estimate by 8.7 Mt to 104.1 Mt!
That a figures significantly lower than the current USDA projections (109 Mt) and which could again be revised (significantly) downward in the coming weeks.
At the same time, international demand remains strong.
On the European market, yesterday we saw again an unprecedented session in terms of volatility, where after a clear opening, the wheat market gave way in the second part of the day lossing double digit.
Indeed, the deadline of May 2021, fell over € 14 / t in a market context that had become very tight, before its expire of next Monday and thanks to physical deliveries.
The 33,000 t from Romania unloaded in Dunkirk, jouked an important roule of course in this game.
The rains, meantime, are pushing down only wheat prices, meanwhile rapeseed and corn remain firm.
The precipitations which come to affect France, as well as the United Kingdom and Germany, indeed, are reassuring for wheat after the dry conditions which accompanied the spring.
However, this rains are still insufficient to fully revive the potentials in many regions, especially for rapeseed which prices still show the same firmness, against a backdrop of a disappointing European harvest and crushing activity that remains very strong.
Operators, in add, are waiting for StatCan will release estimated inventory data starting March 31 this Friday.
Rapeseed, meantime, took advantage of tense fundamentals and a sharp recovery of the Malaysian palm (+ 5%) to offer clear gains.
From Black Sea basin, markets closed today, but meantime, consultancy SovEcon is predicting a record-breaking corn production in Ukraine this year after releasing its latest estimate of 1.441 billion bushels.
That would represent a year-over-year increase of nearly 21%, if realized.
Consultancy SovEcon now estimates a record 2021 wheat production for Ukraine, raising its forecast 2.9% to 1.051 billion bushels, which it based on “ample precipitation” through April that improved quality ratings and yield potential.
That would barely best Ukraine’s record wheat harvest in 2019, if realized.
Aussie local market have kicked off the week, spiking a tad higher on new crop, but the bids and offers remain wide.
Meantime, ASX Jan 22 market closed at $321/t.
New crop canola markets also started the week up with delivered bids into the crushers Geelong/Melbourne around $740 level; growers along the east coast will want to see some more rainfall on crops before another round of sales.
Current crop markets remain the same old story with prompt wheat bids paying a premium into port.
We saw barley catch a bid early in the day through Victoria in the upcountry BHC sites.
Rain has been patchy thus far for southern NSW and has not eased concerns for plant establishment.
Growers are hopeful there is more coming through today.
Offers to the market have been limited with growers in sowing mode.
Short term (2 weeks out) freight continues to be the golden ticket as delivered port market continues to trade at a premium.
PKE, in particular, at $10/t over Newcastle.
Internationally, South Korea purchased 65,000 tonnes of corn from optional origins in an international tender that closed yesterday.
The grain is for arrival in late November.
Tonigth we will see how the sessions will close.
