GRAIN MARKET VIEW
August 4, 2023 – Market Focus
Good morning, Farmer Family …
Main Markets
USA
US farm markets were mixed but mostly lower on Thursday.
Corn prices eroded another 1.54% lower.
Soybean firmed 0.40%.
The rest of the soy complex was mixed, as soymeal gained 0.75%, while soyoil dropped 0.96%.
Wheat prices continued to fall, as Chicago SRW closed down 2.03%, Kansas City HRW lost 2.48%, and Minneapolis spring wheat prices dropped 1.83%.
Commodity funds were net buyers of CBOT soybean and soymeal futures contracts, and net sellers of wheat, corn and soyoil futures contracts.
On this morning, Chicago wheat rose over 3% after Ukrainian drone attacks near the Russian Black Sea grain export port of Novorossiysk.
Corn and soybeans also rose, partly following wheat.
Corn prices eroded another 1.54% lower.
Soybean firmed 0.40%.
The rest of the soy complex was mixed, as soymeal gained 0.75%, while soyoil dropped 0.96%.
Wheat prices continued to fall, as Chicago SRW closed down 2.03%, Kansas City HRW lost 2.48%, and Minneapolis spring wheat prices dropped 1.83%.
Commodity funds were net buyers of CBOT soybean and soymeal futures contracts, and net sellers of wheat, corn and soyoil futures contracts.
On this morning, Chicago wheat rose over 3% after Ukrainian drone attacks near the Russian Black Sea grain export port of Novorossiysk.
Corn and soybeans also rose, partly following wheat.
Canada
In Canada, conditions remain mostly very warm and dry, leading to an ultra-early start to the harvest.
South America
Brazil’s soybean output, is expecting to reach another record-breaking crop.
Brazilian consultancy Celeres is expecting an unprecedented prediction of 165.91 MMT, while StoneX 163.5 MMT.
Celeres estimates that the country’s 2023/24 corn production will reach 139.09 MMT.
The USDA’s post in Buenos Aires has pegged 2023-24 Argentine wheat production at 17.0Mt, 0.5Mt lower than the official USDA estimate.
Barley production is estimated at 4.5Mt, 0.8Mt lower than the official USDA estimate.
Corn production is projected at 55.0Mt, 1.0Mt higher than the official USDA estimate and sorghum production is forecast at 4.0Mt, 0.7Mt higher than the official USDA estimate.
Warm, dry weather over the last week allowed Argentine farmers to resume their wheat planting in previously muddied fields in the south of the country’s core agricultural area, the Buenos Aires Grain Exchange said Thursday in its weekly crop report.
Brazilian consultancy Celeres is expecting an unprecedented prediction of 165.91 MMT, while StoneX 163.5 MMT.
Celeres estimates that the country’s 2023/24 corn production will reach 139.09 MMT.
The USDA’s post in Buenos Aires has pegged 2023-24 Argentine wheat production at 17.0Mt, 0.5Mt lower than the official USDA estimate.
Barley production is estimated at 4.5Mt, 0.8Mt lower than the official USDA estimate.
Corn production is projected at 55.0Mt, 1.0Mt higher than the official USDA estimate and sorghum production is forecast at 4.0Mt, 0.7Mt higher than the official USDA estimate.
Warm, dry weather over the last week allowed Argentine farmers to resume their wheat planting in previously muddied fields in the south of the country’s core agricultural area, the Buenos Aires Grain Exchange said Thursday in its weekly crop report.
Europe
Grain markets continued to suffer a bearish pressure, with European wheat falling for the 8th session in a row – a net loss of 32 euros/MT, while it is looking for export outlets, as Black Sea wheat dominates.
North Africa
Egypt’s Supply Ministry says that strategic wheat reserves are seen as sufficient to last for a period of six months.
Ukraine
The Ukrainian Grain Traders Union have revised up its 2023-24 total grain and oilseed crop forecast by almost 8Mt to 76.8Mt.
Ukrainian farmers have harvested 16.57 million tons of the 2023 grain harvest, the agriculture ministry said on Friday.
Ukrainian farmers have harvested 16.57 million tons of the 2023 grain harvest, the agriculture ministry said on Friday.
Russia
As of July 1, there were almost 13.2 mln tonnes of grains in agricultural enterprises of the Russian Federation, which is 1.6 times higher year-on-year, according to Rosstat data.
The Russian Grain Union estimates total July grains shipments at 5.7Mt, up 60pc from last year.
The Russian Grain Union estimates total July grains shipments at 5.7Mt, up 60pc from last year.
China
Typhoons Khanun, Doksuri add to China’s food security headache, as export bans push up global prices.
The Chinese Government will this weekend be removing tariffs on Australian barley which have been in place since 2020.
The Chinese Government will this weekend be removing tariffs on Australian barley which have been in place since 2020.
Southeast Asia
It is being reported that India is considering importing 9Mt of wheat from Russia via a government-to-government deal.
Indian Government mulls lowering import duty, limiting traders’ stock to tame rising wheat prices.
Malaysian palm oil prices extended early losses on Thursday, hitting its lowest closing since the end of June.
Indian Government mulls lowering import duty, limiting traders’ stock to tame rising wheat prices.
Malaysian palm oil prices extended early losses on Thursday, hitting its lowest closing since the end of June.
Australia
Price moves were moderate in the past week as consumers weigh up the likelihood of a low-volume season in the north, and what could well be another bumper year in the south.
FAO Food Price Index – August 2023 Update
The FAO Food Price Index averaged 123.9 points in July 2023, up 1.5 points (1.3 percent) from June.
The FAO Cereal Price Index averaged 125.9 points in July, down 0.7 points (0.5 percent) from June.
The FAO Vegetable Oil Price Index averaged 129.8 points in July, up 14.0 points (12.1 percent) from June.
The FAO Dairy Price Index averaged 116.3 points in July, down 0.5 points (0.4 percent) from June.
The FAO Meat Price Index* averaged 117.8 points in July, down 0.4 points (0.3 percent) from June.
The FAO Sugar Price Index averaged 146.3 points in July, down 5.9 points (3.9 percent) from June.
The FAO Cereal Price Index averaged 125.9 points in July, down 0.7 points (0.5 percent) from June.
The FAO Vegetable Oil Price Index averaged 129.8 points in July, up 14.0 points (12.1 percent) from June.
The FAO Dairy Price Index averaged 116.3 points in July, down 0.5 points (0.4 percent) from June.
The FAO Meat Price Index* averaged 117.8 points in July, down 0.4 points (0.3 percent) from June.
The FAO Sugar Price Index averaged 146.3 points in July, down 5.9 points (3.9 percent) from June.
Auctions
Corn
Algerian state agency ONAB is believed to have bought one consignments of about 40,000 metric tons of animal feed corn.
Milling wheat
Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) bought a total of 86,290 metric tons of food-quality wheat.
Egypt’s state grains buyer, the General Authority for Supply Commodities (GASC), said on Wednesday it had bought 360,000 metric tons of wheat.
Egypt’s state grains buyer, the General Authority for Supply Commodities (GASC), said on Wednesday it had bought 360,000 metric tons of wheat.
Durum wheat
Algeria’s state grains agency OAIC is believed to have rejected all offers and made no purchase in an international tender for a nominal 50,000 metric tons of durum wheat which closed on Wednesday.
Macroeconomics
Energy markets
Oil prices gained about 2% on Thursday as Saudi Arabia and Russia took steps to keep supplies tight into September and possibly beyond.
Notably, Brent futures rose $1.94, or 2.3%, to settle at $85.14 a barrel, while U.S. West Texas Intermediate crude rose $2.06, or 2.6%, to settle at $81.55.
On this morning, prices were on track for a sixth week of gains.
Notably, Brent futures rose $1.94, or 2.3%, to settle at $85.14 a barrel, while U.S. West Texas Intermediate crude rose $2.06, or 2.6%, to settle at $81.55.
On this morning, prices were on track for a sixth week of gains.
Ocean freight markets
The Baltic Exchange’s main sea freight index in London edged higher by 5 points to 1,128, buoyed by an uptick in panamax vessel rates.
Equity markets
On Wall Street, US stock indexes, posted mild losses, on higher bond yields, as the 10-year US T-note yield climbed to an 8-3/4 month high.
Notably, the S&P fell 0.2% to 4,501.89 a day after its biggest daily decline in four months.
The Dow Jones Industrial Average lost 0.2% to 35,215.89 and the Nasdaq composite dipped 0.1% to 13,959.72.
On this morning, Asian stocks markets were mixed.
The Shanghai Composite Index rose 0.6% to 3,301.26.
The Hang Seng in Hong Kong gained 1.2% to 19,649.78.
The Nikkei 225 in Tokyo lost 0.1% to 32,129.49, and Sydney’s S&P-ASX 200 shed less than 0.1% to 7,307.80.
The Kospi in Seoul advanced 0.1% to 2,607.90.
India’s Sensex opened 0.6% at 65,674.90.
New Zealand and Bangkok gained while Singapore and Jakarta retreated.
Notably, the S&P fell 0.2% to 4,501.89 a day after its biggest daily decline in four months.
The Dow Jones Industrial Average lost 0.2% to 35,215.89 and the Nasdaq composite dipped 0.1% to 13,959.72.
On this morning, Asian stocks markets were mixed.
The Shanghai Composite Index rose 0.6% to 3,301.26.
The Hang Seng in Hong Kong gained 1.2% to 19,649.78.
The Nikkei 225 in Tokyo lost 0.1% to 32,129.49, and Sydney’s S&P-ASX 200 shed less than 0.1% to 7,307.80.
The Kospi in Seoul advanced 0.1% to 2,607.90.
India’s Sensex opened 0.6% at 65,674.90.
New Zealand and Bangkok gained while Singapore and Jakarta retreated.
Currency trading
The dollar index fell back from a 3-1/2 week high and posted a slight loss, as a long liquidation emerged in the dollar after stocks recovered from their worst levels, curbing liquidity demand for the dollar.
