August 8, 2023 – Market Focus

Good morning, Farmer Family …

Main Markets

US farm markets were mixed on Monday.
Corn prices fell 0.41%.
Soybeans slumped 2.79%, with soymeal down 0.80%, and soyoil 2.00% weaker.
Wheat prices found variable gains, as Chicago SRW jumped 3.87%, Kansas City HRW rose 2.29%, and Minneapolis spring wheat picked up 0.24%.
Geopolitical turmoil in the Black Sea region, and weather forecasts continued to be on focus.
Weekly Export Inspections data showed 376,623 MT of corn was shipped during the week that ended 8/3, with the season’s total shipment down 33% year over year. The report had 281,857 MT of soybean exports, with total soybean exports still 6.9% lighter year/year. Wheat shipments were at 275,067 MT, and cumulative totals for the 2023/24 marketing year are off to a slow start compared to last year’s pace so far.
Via mandatory communication, US private exporters reported sales of 251,460 tonnes of corn for delivery to Mexico for the 2023-24 marketing year and 132,000 tonnes of soybeans for delivery to China.
Corn basis bids were largely steady across the central U.S., but did tilt 3 to 5 cents at two Midwestern ethanol plants.
Soybean basis bids were mostly steady across the central U.S., but did climb 20 cents higher at an Illinois processor.
Commodity funds were net buyers of CBOT wheat futures contracts, and net sellers of soybean, soyoil, soymeal and corn futures.
Overnight, after the sessions close, the weekly US crop conditions report had both corn and soy conditions up 2 points from the previous week, at 57pc and 54pc good/excellent. Spring wheat conditions were slightly lower, with 41% in “good to excellent” condition, down one point on the previous week. NASS also reported the winter wheat harvest at 87% complete as of 8/6, while spring wheat harvest was 11% complete.
This morning, Chicago soybean and corn prices lost more ground.
Wheat prices slid, giving up some of the last session’s gains.
Notably, the most-active soybean contract on the Chicago Board of Trade lost 0.3% at $12.98 a bushel, as of 04:30 GMT, and corn gave up 0.2% to $4.95 a bushel. Wheat fell 1% to $6.51 a bushel.
South America
AgRural has further increased to 135.4 million metric tons, its estimate for total Brazil’s corn output in 2023, on gigantic second corn crop, now expects to hit 105.6 million tons. By Aug. 3, farmers had harvested 64% of the area planted for their second corn crop.
The Rosario Stock Exchange reported that Argentina’s July maize sales were estimated at 6.4Mt, the highest volume for July in the past seven years. The total included 4.4Mt sold after the preferential exchange rate scheme was implemented on 25 July.
Wheat prices rose on Euronext, turning to levels equivalent to those seen last week on increasing concerns from Black Sea region.
In oilseed markets, despite the closure of the Winnipeg Stock Exchange, rapeseed prices fell back after last weekend’s rebound.
Hungary wheat harvest could reach 5.6 mln tonnes.
Poland positively evaluates the idea of transferring the inspection of Ukrainian agricultural cargo from the Polish-Ukrainian border to the ports of the Baltic Sea.
Weather conditions are improving in Northern Europe after a period of rain and falling temperatures.
Syria will import half as much wheat in 2023 as the previous year due to an expected boost in the domestic harvest.
Some 15,000 tonnes of grains were damaged on Monday, after a blast ripped through grain silos near the port of Derince in northwest Turkey.
The number of vessels in the Ukrainian Danube ports significantly decreased during the week.
According to the spring data, the total planting area of agricultural crops in all categories of farms in the Russian Federation decreased to 81.2 mln ha in 2023.
Russian consultancy IKAR has raised its estimates for both the country’s 2023 wheat production and exports for the 2023/24 marketing year. IKAR’s new production estimate is for 87.99 MMT, with exports now anticipated to reach 47.49 MMT.
SovEcon also revised its 2023-24 Russian wheat exports estimate to a record 48.1Mt.
Wholesale prices of China’s farm produce edged up during the week from July 28 to August 3, data from the Ministry of Agriculture and Rural Affairs shows.
China’s corn prices rose for the fourth straight trading day as the market was concerned floods in northern and northeastern producing regions have damaged crops.
China soybean import in July, was up 23.5% from a year ago.
Southeast Asia
Malaysian palm oil fell to near six-week closing low, on higher stock outlook.
India’s Food Secretary confirmed India was considering cutting the wheat import tax (currently set at 40pc) and reducing the amount that wheat millers and traders could hold.
Australia exported 466kmt of barley in June, down from 598kmt in May, but local consumers and exporters began the week focusing on barley after the return of China as a buyer of Australian barley.
Wheat values were largely unchanged for the day, both current and new crop.
Canola bids were $15/t firmer by the end of the day.
Australia chickpea exports surged in June, while lentils dropped.


Milling wheat
A Syrian state grains agency has issued an international tender to purchase and import 200,000 metric tons of soft milling wheat. The deadline for the submission of price offers in the tender from the Syrian Grain Establishment is Aug. 23. Offers will be opened on the same day, but prices submitted must remain valid for 15 days. Shipment is sought 60 days after contract award.
The Syrian Grain Establishment has also sent a separate request to trading houses to exchange 100,000 metric tons of Syrian durum wheat for 100,000 metric tons of imported soft milling wheat. The deadline for offers to take part in the exchange is Sept. 5. Syria is seeking a payment to make up the difference in value of the higher priced durum and cheaper soft wheat.


Energy markets
Oil prices settled down 1%, after six straight weekly gains, with Brent crude settling 90 cents, or 1.04% lower, at $85.34 a barrel, while U.S. West Texas Intermediate crude settled down 88 cents, or 1.06%, at $81.94 a barrel.
Investors braced for weaker demand from China and the United States.
On this wake, oil prices slipped this morning, after data showed China’s imports and exports fell much more than expected in July.
Brent crude futures indeed were at $85.05 a barrel, down by 29 cents, or 0.34%, at 06:41 GMT, while U.S. West Texas Intermediate crude was at $81.69 a barrel, down by 25 cents, or 0.31%.
Losses, however, were limited by expected supply tightness.
Ocean freight markets
The Baltic Exchange’s main sea freight index in London rose for a third straight session, on firm rates for larger vessels.
Equity markets
US stock indexes posted moderate gains on optimism that Q2 corporate earnings results will continue to outperform.
Notably, the S&P 500 rose 0.9% to 4,518.44 ahead of Thursday’s U.S. inflation update.
The Dow Jones Industrial Average rallied 1.2% to 35,473.13.
The Nasdaq composite added 85.16, or 0.6%, to 13,994.40.
This morning, Asian stock markets were mixed.
The Shanghai Composite Index lost 0.1% to 3,265.02 after customs data showed Chinese exports fell 14.5% from a year earlier in July, adding to pressure on Beijing to reverse an economic slump.
The Hang Seng in Hong Kong sank 1.4% to 19,259.88.
The Nikkei 225 in Tokyo rose 0.3% to 32,365.11 after the Japanese government reported labor cash earnings rose 2.3% in June.
The Kospi in Seoul lost 0.3% to 2,572.46 and Sydney’s S&P-ASX 200 gained 0.2% to 7,321.90.
India’s Sensex opened up 0.1% at 3,314.02.
New Zealand, Bangkok and Jakarta retreated while Singapore rose.
Currency trading
The dollar index rose slightly by +0.02% on hawkish Fed comments, though strength in stocks reduced the liquidity demand for the dollar.
Notably, the EUR/USD rose by +0.01%, while the USD/JPY rose by +0.48%.
This morning, the dollar rose to 143.33 yen from Monday’s 142.44 yen.
The euro declined to $1.0992 from $1.1007.

That’s all, thank you.
We wish you a nice day.

Author: Sandro F. Puglisi

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