US grain prices continued to recover last Friday after stumbling earlier in the week.
Corn prices rose nearly 2%.
Soybeans were up around 1%.
Some wheat contracts trended as much as 1.75% higher.
On macro markets, oil prices settled at a three-year high above $85 a barrel, boosted by forecasts of a supply deficit in the next few months as the easing of coronavirus-related travel restrictions spurs demand.
The White House, meantime, said it will lift COVID-19 travel restrictions for fully vaccinated foreign nationals effective Nov. 8, which should boost jet fuel demand.
The International Energy Agency on Thursday said the energy crunch is expected to boost oil demand by 500,000 barrels per day (bpd).
Thus, Brent crude futures settled up 84 cents, or 1%, at$84.84 a barrel.
Front-month prices, which touched their highest level since October 2018 at $85.10, hit a weekly rise of 2,78%, its sixth straight weekly gain.
U.S. West Texas Intermediate (WTI) crude futures rose $1,22, or 1.5%, to $82.53 a barrel.
That was up 3.7% on the week in an eighth consecutive weekly rise.
Oil prices hit their highest in years also on this morning.
Brent crude oil futures rose 63 cents, or 0.7%, to $85.49 a barrel by 0645 GMT, after hitting a session-high of $86.04, the highest price since October 2018.
U.S. West Texas Intermediate (WTI) crude futures climbed 95 cents, or 1.2%, to $83.23 a barrel, after hitting a session-high of $83.73, highest since October 2014.
On the financial side, U.S. stocks climbed on Friday and the main indexes were set for weekly gains after Goldman Sachs capped a strong earnings season for big banks, while a surprise rise in retail sales and a fall in new claims for unemployment benefits raised optimism about economic recovery.
Strong results from big financial institutions have taken focus away from concerns about U.S. debt default, surging commodity prices and supply chain disruptions, which had fueled market volatility earlier this month.
Thus the Dow Jones Industrial Average was up 382.20 points, or 1.09%, at 35,294.76.
The S&P 500 was up 33.11 points, or 0.75%, at 4,471.37, tracking its best week since late July, and the Nasdaq Composite was up 73.91 points, or 0.50%, at 14,897.34, set for its best weekly performance since late August.
Shares of cryptocurrency and blockchain-related firms Riot Blockchain, Coinbase Global, MicroStrategy Inc and Marathon Digital added between 2.5% and 7.2% as bitcoin hit $60,000 for the first time since April.
For the week, the Dow added 1.64%, the S&P 500 rose by 1.96% and the Nasdaq gained 2.46%.
Meantime, mainland Chinese and Hong Kong equity markets fell on this morning after data showed China’s economy grew more slowly than expected in the third quarter, weighing on regional stocks.
China’s gross domestic product (GDP), indeed, grew 4.9% in July-September from a year earlier.
China is grappled with power shortages.
Supply bottlenecks, sporadic COVID-19 outbreaks and rising jitters over the property sector, weighed on grews.
Thus, Chinese blue chips were down 1.53%.
The Hong Kong benchmark lost 0.56%.
The weaker-than expected data weighed on regional benchmarks. MSCI’s broadest index of Asia-Pacific shares outside Japan was last down 0.2%, while Japan’s Nikkei lost 0.3%.
The Asian declines come after stocks globally finished last week in a bullish mood posting their best day in five months.
Coming back on grains market, US row crop areas are slowing picking up field work again after the rains later last week.
The agency’s 8-to-14-day outlook predicts drier-than-normal conditions will return to the eastern Corn Belt between October 22 and October 28, meantime, with seasonally warm weather likely for much of the central U.S. during that time.
With the dry week ahead has farmers looking forward to making good headway in the ongoing harvest.
US international sales exceeded market expectations last week.
Wheat was at 568,000t, corn at 1 million tonnes (Mt), soybeans were 1.1Mt of those 640,000t with destination China, although part of that was switched from unknown.
Milo/sorghum was 2,500t only.
Thus, corn export sales were up 85% from the prior four-week average.
Soybean export sales stayed 9% above the prior four-week average.
Wheat export sales jumped 70% higher week-over-week and 42% above the prior four-week average.
Additionally, massive export sales flashes confirmed the ongoing rumours about Chinese bean purchases through last week, 132,000t to China, 396,000t to unknown and 327,000t to unknown.
On the other hand, National Oilseed Processors Association soybean crush, fell 3.2% month-over-month, to 153.8mbu, below most ideas but still high for September.
In this context, corn basis bids dropped 4 cents lower at an Ohio elevator and an Illinois river terminal while firming 3 cents higher at an Iowa processor and holding steady across other Midwestern locations on Friday.
Soybean basis bids were steady to mixed on Friday, moving as much as 9 cents higher at an Illinois river terminal while falling as much as 10 cents lower at a Nebraska processor.
From South America, a widespread storm event is forecast for almost all the Brazilian soybean belt.
Planting still is ticking along there amid optimism about new crop production levels pushing up with more reasonable conditions.
Rains in central Argentina have helped farmers plant 2021/22 corn with 23.2% of expected area sown so far, the Buenos Aires Grains Exchange said on Thursday, while growers wrestle with a new export policy that they say could force them to plant less.
Argentina is the world’s second biggest corn exporter, after the United States.
Of the 55 million tonnes of corn expected to be harvested this season, a record 38.5 million have been sold as growers rush to lock in high international prices while farm costs are pushed up by high inflation.
On European market, Euronext recorded clear gains on Friday evening, driven by a market with still tense fundamentals.
Wheat stood out in particular by fetching a new record for its December 2021 deadline, driven by rumors of substantial purchases of French wheat from China.
On this wake, FranceAgriMer has estimated exports of wheat from France outside the EU at 9.6 million tonnes for the entire current season, up 2 million tonnes compared to the 2020/2021 season.
Corn prices were also on the rise, supported by the livestock feed sector.
Rapeseed, on its part, over the weekend wiped out most of its decline in previous days in the wake of canola in particular.
On the supply side, winter sowing in France is progressing rather quickly with wheat sowing 13% completed according to FranceAgriMer (11% last year), while winter barley is sown at 24% (11% in 2020). .
The corn harvests were also able to accelerate to reach 15% of the national surfaces on October 11, but remain very late compared to last year (62%).
The increase in production costs, mainly linked to that of fertilizers for the 2022 harvest, raises many questions about the upcoming marketing for the next season.
From the Black Sea basin, weather maps are bringing more chances of rain for central Ukrainian areas later this month but still next to nothing into the Russian Volga.
Meantime, Russia’s wheat exports reached 19.314.718 t between January and August, trending 1.6% below volume from the first eight months of 2020.
However, because of stronger prices, the value of this year’s exports has trended 15% higher year-over-year.
Russia continued to reinforce the inertia of world prices by again raising its export tax on wheat from $ 2.60 / t, to $ 61.30 / t.
Thus wheat prices rose on Friday in both Russia and Ukraine even if physical activity was reduced last Friday due to the closure of many markets for Bank Holidays.
Corn prices, however, remained relatively stable, not following those of wheat.
The opening of Nord stream 2 to supply Europe with Russian gas is now awaiting authorization from Germany.
From the Middle Kingdom, China is ready to start a fresh round of wheat auctions from state reserves .
China will sell 1 million tonnes of wheat at auction from the state reserves on Oct. 20, the National Grain Trade Center said in a notice on Friday.
From Australia, there is finally getting a dry week for the east coast after the last few storms, and extended run maps aren’t bringing any rain into next week yet.
The forecast rains for WA remain mostly coastal, though still being watched to see if they shift further inland.
Meantime, Australia exported 151,763 tonnes of canola in August, up 39 per cent from 109,520t shipped in July, according to the latest data from the Australian Bureau of Statistics (ABS).
Japan on 85,824t was Australia’s biggest market, followed by the United Arab Emirates on 45,000t and Nepal on 15,377t.
Australia’s August 2021 canola export figures are well up from the 1636t shipping in August 2020, a tiny figure which reflects the rundown on stocks from an export year heavily impacted by drought in New South Wales.
This year Australia is on track to produce 5 million tonnes of canola, with the first cargo of new crop due to load in Western Australia late this month.
Internationally, Pakistan, for its part, did not respond to its tender for 90,000 t of wheat.
Egypt has strategic wheat reserves sufficient for five months of consumption, the head of the internal trade development authority, Ibrahim Ashmawi, told Reuters on Monday!!
Usually, its coming a new tender from GASC.
Jordan tenders to buy 120,000 tonnes feed barley.
The deadline for submission of price offers in the tender is Oct. 21.
Possible shipment combinations of 60K are in 2022 between Jan. 16-31, Feb. 1-14, Feb. 15-28 and March 1-15.
The Ethiopian Trading Businesses Corporation (ETBC) now invites to do sealed bids from Eligible and qualified Bidders for the Procurement of 400,000 Metric Tons of Milling Wheat.
Closing date November 30, 2021.
We wish you a good day and a good start to the week.
