US grain prices ended yesterday’s session with mixed results.
Wheat prices kept moving higher pushing most contracts up another 1.75% to 2.75%.
Corn fought through a choppy session to close 1% lower.
Soybeans finished with more moderate losses.
Meanwhile, on macro markets crude oil is off another buck fifty to $71.6 WTI / $73.5 Brent.
Investors attempt to balance reopening optimism with worries over inflation trends and the possibility of future interest rate hikes.
In deed, despite the ongoing concerns over new COVID-19 variants and outbreaks, the global economy has gradually continued to pick up pace.
US new jobless claims, at 360,000 this week, reached lows not seen since the beginning of the pandemic.
They were down nearly 10 per cent.
Consequentially on Wall St. the DOW was up only 54 points to 34.987, meantime the U.S. Dollar firmed moderately.
Coming back on grains market, spring wheat areas in the northern US and in the southern Canadian Prairies continue to bake in hot, dry weather.
There’s no relief forecast.
Corn Belt weather maps are also turning drier and hotter into later this month, but with favourable recent moisture and temperatures there’s little concern being expressed right now for eastern and central areas.
Meantime, the EPA reports that the U.S. generated 1.27 billion ethanol blending credits in June, which was fractionally above May’s total of 1.26 billion.
The U.S. also generated 428 million biodiesel blending credits last month, versus 397 million in May.
The soybean crushing activity in the USA is down – 6.8% in June according to the NOPA compared to May, and down -8.9% compared to June 2020, as a result of the increase in course of the seed.
In deed, per latest data released by the National Oilseed Processors Association volume fell to a two-year low of 152.140 million bushels and below the entire range of analyst estimates.
Soyoil stocks fell to an eight-month low of 1.357 billion pounds.
On the other hand, regular export sales had wheat at 0.4 million tonnes (Mt), corn 0.13Mt similar old crop, and beans 0.3Mt.
There were no new flashes and no real surprises other than a boat of HRW wheat sold to Brazil.
That pushed wheat exports to move 46% higher week-over-week and 44% above the prior four-week average.
Corn export shipments fell 18% lower week-over-week and dropped 26% below the prior four-week average.
Soybean export shipments slid 11% lower from a week ago but remained 4% above the prior four-week average.
Wheat export shipments inched 4% above the prior four-week average.
In this context, corn basis bids were steady to mixed.
Bids were especially variable at Midwestern ethanol plants, moving as much as 10 cents higher at one location while stumbling as much as 20 cents lower at another.
Soybean basis bids were mostly steady but mixed at a handful of Midwestern locations, moving as much as 10 cents higher at an Illinois processor while sliding as much as 5 cents lower at an Iowa processor.
From South America, Argentina’s Rosario Grains Exchange annunced that 96% of wheat was sown and lifted the wheat crop forecast to 20.5Mt from its earlier estimate of 20Mt, citing higher area.
Corn production is estimated at 51 million tonnes.
On European market, we have seen another session of increase on grains.
Also rapeseed prices continues to grow on Euronext, in the wake of canola, amid fears of a sharp reduction in production in Canada.
Meantime, European internal river barge movements are seeing some delays after flooding closed the Rhine River.
However, it is expected to be back open early next week.
Strategie Grains on Thursday further increased its monthly production forecasts for all three major cereals in the European Union in the current 2021/22 season, which it said will help the bloc to meet higher projected demand on the global market.
However, the consultancy also echoed mounting concerns over the potential impact on grain quality from recent wet weather in southeastern and western areas of the EU.
The consultancy forecast that the 27-country bloc would harvest 133.0 million tonnes of soft wheat in 2021, up from 131.1 million projected in June and more than 14 million tonnes above last year’s crop.
For barley, Strategie Grains raised its 2021 crop forecast to 55.0 million tonnes from 53.9 million, still slightly below last year’s output of 55.4 million tonnes.
The hefty wheat and barley crops, along with larger expected international demand, would benefit EU shipments this season, it said.
Therefore Strategie Grains now expects EU soft wheat exports this season at 31.0 million tonnes, up from 28.6 million tonnes forecast last month and 26.9 million tonnes in 2020/21.
Barley exports were seen at 7.2 million tonnes, up from last month’s projection of 6.7 million tonnes and close to last season’s 7.3 million tonnes.
A cut in expected production in North America and the Middle East and Turkey means that the EU will need to mobilise its entire exportable supplies to meet global demand, Strategie Grains said, even with Russia potentially selling more than 40 million tonnes.
Chinese import demand is expected to remain high in 2021/22, though slightly lower than last season, which should support French exports, it said.
Strategie Grains also lifted its estimate for the bloc’s maize crop, usually harvested in the autumn.
The crop is now seen at 65.7 million tonnes, up from 65.3 million tonnes.
From Black Sea basin, Sovecon and Ikar have downgraded their wheat production estimates in Russia, to 82.3 million tonnes.
Markets are trimming yield ideas for spring wheat, areas in Kazakhstan and Siberia having been stressed by dry conditions.
Winter wheat areas, particularly those later maturing zones, have also suffered heat and dryness towards the finish of their crops, and will likely harvest lower yields.
The heat wave observed in the Black Sea is reaching its climax.
Temperatures in the southern district of Russia are expected to exceed 40 ° C over the next 4-5 days.
In central Ukraine, 35 ° C is also reached.
Temperatures have been well above seasonal norms in the region for a month now.
In Kyiv, already 10 temperature records have been broken since the beginning of July.
Even though water reserves are not dry, crops, and in particular those of corn, suffer from this excess heat, during the flowering period.
Thus, more and more operators doubt the possibility for Ukraine to obtain in this year a new record of maize production.
From Australia, Aussie local markets generally quiet in the gradual push toward spring.
The weather forecasts for WA continue to improve, with 30-40 mm predicted across the entire wheat belt early next week.
Over east, showers also are forecast for EP and southern parts of the Mallee.
Internationally, as expected, Japan purchased 118.911 t of food-quality wheat from the United States and Canada in a regular tender that closed earlier today.
Of the total, 52% was sourced from the U.S.
The grain is for shipment in September.
We wish you a good day.
