GRAIN MARKET VIEW
August 28, 2023 – Market Focus
Good morning, Farmer Family …
Main Markets
USA
US farm markets were mixed on Friday.
Corn prices dropped 0.32%.
Soybeans grabbed double-digit gains, rising 1.12%.
The rest of the soy complex was also in the green, though soymeal picked up just 0.02%, while soyoil climbed 1.82% higher.
Wheat prices were mixed, as Chicago SRW fell 1.78%, while both Kansas City HRW and Minneapolis spring wheat eased 0.13%.
The Pro Farmer crop tour pegged the average US corn yield at 172 bushels/Acre, lower than USDA’s 175.1 bushels/acre. US corn production was seen slightly below 15 billion bushels (USDA 15.1 billion bushels).
The average soybean yield was seen at 49.7 bushels/acre, with production at 4.11 billion bushels (USDA 50.9 bushels/acre, production at 4.21 billion bushels).
US private exporters reported sales of 120,000 tonnes of soybeans to China during the 2023-24 marketing year.
In this context …
Corn basis bids were steady to mixed across the central U.S., after trending as much as 5 cents higher at an Indiana ethanol plant and as much as 10 cents lower at another Indiana ethanol plant.
Soybean basis bids held steady across the central U.S..
Wheat basis ended the week up or relatively unchanged in the Gulf and PNW with the exception of SW still trending down. The Great Lakes region held flat.
Commodity funds sold 500 lots of corn, 2,500 lots of wheat and bought 3,500 lots of soybeans.
For the week, corn had an up and down week, but ended on a weaker note, with September down 1.83%.
Soybeans continued their climb, as September was up 1.34%.
The product values flipped spots, as Sep soymeal was 4.68% higher and bean oil was 2.28% lower.
The wheat complex continues to slip lower.
MPLS led the bear charge this week with the front month 3.36% lower.
Chicago ended the week with September 3.26% lower.
While Kansas City was the exception with September up 0.07%.
After the sessions close, CFTC data showed large speculators increased their net short position in Chicago corn and wheat in the week to Aug. 22 while raising their long position in soybeans.
This morning, Chicago soybeans rose 1.5% to a one-month high.
Wheat and corn also rose.
Corn prices dropped 0.32%.
Soybeans grabbed double-digit gains, rising 1.12%.
The rest of the soy complex was also in the green, though soymeal picked up just 0.02%, while soyoil climbed 1.82% higher.
Wheat prices were mixed, as Chicago SRW fell 1.78%, while both Kansas City HRW and Minneapolis spring wheat eased 0.13%.
The Pro Farmer crop tour pegged the average US corn yield at 172 bushels/Acre, lower than USDA’s 175.1 bushels/acre. US corn production was seen slightly below 15 billion bushels (USDA 15.1 billion bushels).
The average soybean yield was seen at 49.7 bushels/acre, with production at 4.11 billion bushels (USDA 50.9 bushels/acre, production at 4.21 billion bushels).
US private exporters reported sales of 120,000 tonnes of soybeans to China during the 2023-24 marketing year.
In this context …
Corn basis bids were steady to mixed across the central U.S., after trending as much as 5 cents higher at an Indiana ethanol plant and as much as 10 cents lower at another Indiana ethanol plant.
Soybean basis bids held steady across the central U.S..
Wheat basis ended the week up or relatively unchanged in the Gulf and PNW with the exception of SW still trending down. The Great Lakes region held flat.
Commodity funds sold 500 lots of corn, 2,500 lots of wheat and bought 3,500 lots of soybeans.
For the week, corn had an up and down week, but ended on a weaker note, with September down 1.83%.
Soybeans continued their climb, as September was up 1.34%.
The product values flipped spots, as Sep soymeal was 4.68% higher and bean oil was 2.28% lower.
The wheat complex continues to slip lower.
MPLS led the bear charge this week with the front month 3.36% lower.
Chicago ended the week with September 3.26% lower.
While Kansas City was the exception with September up 0.07%.
After the sessions close, CFTC data showed large speculators increased their net short position in Chicago corn and wheat in the week to Aug. 22 while raising their long position in soybeans.
This morning, Chicago soybeans rose 1.5% to a one-month high.
Wheat and corn also rose.
Canada
Statistics Canada will release Canada’s first production estimates of the year, tomorrow Aug. 29.
Common wheat deliveries into the handling system were at 370k mt, and durum at 57.6k mt, in week 3 of this shipping season.
Canadian wheat exports for shipping week three came in at 278.4k mt, for a three-week (YTD) total of 902.6k mt.
Durum wheat exports for week three were at 35.7k mt, for a three-week (YTD) total of 102,8k mt.
Commercial stocks stood at 2.023,4k mt for common wheat, and at 254k mt for durum.
Common wheat deliveries into the handling system were at 370k mt, and durum at 57.6k mt, in week 3 of this shipping season.
Canadian wheat exports for shipping week three came in at 278.4k mt, for a three-week (YTD) total of 902.6k mt.
Durum wheat exports for week three were at 35.7k mt, for a three-week (YTD) total of 102,8k mt.
Commercial stocks stood at 2.023,4k mt for common wheat, and at 254k mt for durum.
South America
The return of the El Nino should boost South American soybean production.
Brazil could set a new soybean production record of around 160 million metric tons in the 2023/24 cycle.
Argentina’s soybean output could almost double.
Brazil could set a new soybean production record of around 160 million metric tons in the 2023/24 cycle.
Argentina’s soybean output could almost double.
Europe
European wheat prices edged lower, consolidating below a one-week high.
The euro reached a two-month low, against the dollar.
French farm office FranceAgriMer reported that 82% of the country’s current corn crop is rated in good-to-excellent condition through August 21. 100% of the country’s soft wheat crop has been harvested through August 21, the office said.
Germany’s grain harvest will fall after suffering from unfavourable weather, but overall harvest volumes were satisfactory, the ministry said.
Poland, Bulgaria, Hungary, Romania and Slovakia – want to extend their current ban on Ukrainian grain imports until at least the end of 2023.
Poland’s export surplus of milling wheat will be only around 3 million tons.
Polish export prices for 12.5% protein wheat were stable this week at around 1,025 zloty (229.3 euros) a ton for August/September delivery to ports.
The euro reached a two-month low, against the dollar.
French farm office FranceAgriMer reported that 82% of the country’s current corn crop is rated in good-to-excellent condition through August 21. 100% of the country’s soft wheat crop has been harvested through August 21, the office said.
Germany’s grain harvest will fall after suffering from unfavourable weather, but overall harvest volumes were satisfactory, the ministry said.
Poland, Bulgaria, Hungary, Romania and Slovakia – want to extend their current ban on Ukrainian grain imports until at least the end of 2023.
Poland’s export surplus of milling wheat will be only around 3 million tons.
Polish export prices for 12.5% protein wheat were stable this week at around 1,025 zloty (229.3 euros) a ton for August/September delivery to ports.
North Africa
Egypt started to build seven massive warehouses for strategic commodities.
Egypt’s supply ministry denied rumours of replacing subsidized bread with flour.
Egypt’s strategic reserves of vegetable oils are sufficient for 6.7 months of local consumption.
Egypt’s supply ministry denied rumours of replacing subsidized bread with flour.
Egypt’s strategic reserves of vegetable oils are sufficient for 6.7 months of local consumption.
Ukraine
Ukraine’s Agriculture Ministry reported that 29Mt (25.3Mt previous year) of grains has been harvested to date, including 22Mt of wheat and 5.8Mt of barley.
Ukraine’s grain exports stood at 4.2 million metric tons in the 2023/24 July-June season as of Aug. 28, of which 1.88 MMT between Aug. 1-28.
Ukraine’s grain exports stood at 4.2 million metric tons in the 2023/24 July-June season as of Aug. 28, of which 1.88 MMT between Aug. 1-28.
Russia
Russian President Vladimir Putin and Turkish President Tayyip Erdogan are expected to hold in-person talks in the near future to restart negotiations on Black Sea grain deal.
A Russian trade delegation visited the Alexandria Chamber of Commerce on Sunday to discuss ways of cooperation with Egyptian counterparts in various fields.
The export duty on sunflower oil in the Russian Federation will remain zero for the fourth month in a row.
A Russian trade delegation visited the Alexandria Chamber of Commerce on Sunday to discuss ways of cooperation with Egyptian counterparts in various fields.
The export duty on sunflower oil in the Russian Federation will remain zero for the fourth month in a row.
China
China’s soymeal prices climbed more than 3%.
South-East Asia
Malaysian palm oil prices posted a second straight weekly gain on Friday, underpinned by stronger rival vegetable oils, despite weak export data.
The benchmark palm oil contract for November delivery on the Bursa Malaysia Derivatives Exchange gained 2.11%, and 2.38% for the week.
The benchmark palm oil contract for November delivery on the Bursa Malaysia Derivatives Exchange gained 2.11%, and 2.38% for the week.
Australia
Local markets finished the week up overall on new and current crop.
It was another dry week for the northern half of NSW and Qld. WA and and the Eyre Peninsula also had a dry week. Southern NSW, Vic and eastern SA received patchy rains.
It was another dry week for the northern half of NSW and Qld. WA and and the Eyre Peninsula also had a dry week. Southern NSW, Vic and eastern SA received patchy rains.
Auctions
Wheat
The Taiwan Flour Millers’ Association bought an estimated 104,000 metric tons of milling wheat to be sourced from the United States in a tender on Friday.
Leading South Korean animal feed group Nonghyup Feed Inc. (NOFI) purchased around 55,000 metric tons of animal feed wheat in a private deal on Friday without issuing an international tender.
Egypt’s state grains buyer is believed to have held direct talks with trading houses on Friday about buying wheat without issuing an international tender but no purchase was reported.
Leading South Korean animal feed group Nonghyup Feed Inc. (NOFI) purchased around 55,000 metric tons of animal feed wheat in a private deal on Friday without issuing an international tender.
Egypt’s state grains buyer is believed to have held direct talks with trading houses on Friday about buying wheat without issuing an international tender but no purchase was reported.
Macroeconomics
Energy markets
Oil prices climbed about 1% to a one-week high, as U.S. diesel prices soared, the number of oil rigs dropped and a fire broke out at a refinery in Louisiana.
For the week, Brent declined less than 1% and WTI lost about 2%.
This morning, oil prices ticked higher after China took steps to support its flagging economy, though investors remained worried about the pace of growth as well as further U.S. interest rate hikes that could dampen fuel demand.
For the week, Brent declined less than 1% and WTI lost about 2%.
This morning, oil prices ticked higher after China took steps to support its flagging economy, though investors remained worried about the pace of growth as well as further U.S. interest rate hikes that could dampen fuel demand.
Ocean freight markets
The Baltic Exchange’s main sea freight index in London fell, finishing its worst week since early-June, weighed down by lower rates for capesize and panamax vessels.
The main index, indeed, fell 12.7% for the week.
The main index, indeed, fell 12.7% for the week.
Equity markets
On Wall Street, US stock indexes ended a volatile session higher, after the Fed Chair Jerome Powell that the U.S. central bank may need to raise interest rates further to ensure inflation is contained, but he also acknowledged that price pressures have eased.
Wall Street recorded its first winning week since July.
The S&P 500 and Nasdaq ended higher for the week, with the Nasdaq rising about 2.3% and ending a three-week streak of losses.
The market rose in the run up to Nvidia’s second-quarter results Wednesday.
This morning Asian shares were mostly higher, as investors were relieved by the head of the Federal Reserve indicating it will “proceed carefully” on interest rates.
Japan’s benchmark Nikkei 225 added 1.8% in afternoon trading to 32,195.91. Australia’s S&P/ASX 200 gained 0.6% to 7,159.80, after data on Australian retail sales showed they rose a higher than expected 0.5%.
South Korea’s Kospi rose 0.8% to 2,538.67.
Hong Kong’s Hang Seng jumped 1.3% to 18,182.87, while the Shanghai Composite surged 1.3% to 3,104.27.
Wall Street recorded its first winning week since July.
The S&P 500 and Nasdaq ended higher for the week, with the Nasdaq rising about 2.3% and ending a three-week streak of losses.
The market rose in the run up to Nvidia’s second-quarter results Wednesday.
This morning Asian shares were mostly higher, as investors were relieved by the head of the Federal Reserve indicating it will “proceed carefully” on interest rates.
Japan’s benchmark Nikkei 225 added 1.8% in afternoon trading to 32,195.91. Australia’s S&P/ASX 200 gained 0.6% to 7,159.80, after data on Australian retail sales showed they rose a higher than expected 0.5%.
South Korea’s Kospi rose 0.8% to 2,538.67.
Hong Kong’s Hang Seng jumped 1.3% to 18,182.87, while the Shanghai Composite surged 1.3% to 3,104.27.
Currency trading
The dollar index rose and posted a new 2-1/2 month high, as bond yields moved higher after the University of Michigan U.S. Aug inflation expectations unexpectedly rose, but Fed Chair Powell comments, and an unexpected downward revision of Aug U.S. consumer sentiment index by the University of Michigan, limited gains.
This morning, the U.S. dollar fell to 146.38 Japanese yen from 146.40 yen. The euro cost $1.0819, up from $1.0798.
This morning, the U.S. dollar fell to 146.38 Japanese yen from 146.40 yen. The euro cost $1.0819, up from $1.0798.
