Grain prices were mixed but mostly higher last Friday. 

Corn prices firmed 1%.

Soybean prices eased around 0.3% lower.

Nearby MGEX spring wheat contracts surged 3.3% higher and surpassed $10 per bushel for the first time in nearly a decade.

Winter wheat contracts were also red hot, moving between 2.1% and 3.5% higher. 

On macro markets, oil traded just below multi-year highs on Friday with bullish sentiment about low supplies tamped by concerns from world leaders that demand disruptions from the COVID-19 pandemic may not be over.

Prices have been boosted by worries about coal and gas shortages in China, India and Europe, spurring some power generators to switch from gas to fuel oil and diesel.

However, winter weather in much of the United States is expected to be warmer than average, according to a National Oceanic and Atmospheric Administration forecast.

But, U.S. crude found support this week as investors eyed low crude stocks at the U.S. storage hub in Cushing, Oklahoma.

Indeed, U.S. Energy Information Administration data on Wednesday showed crude stocks at Cushing fell to 31.2 million barrels, their lowest level since October 2018. 

Thus, Brent crude futures rose $1,1, or 1.31%, to settle at $85.72 a barrel. 

The benchmark, which touched a three-year high of $86.10 on Thursday, was up 0,79% in the week, its seventh weekly gain.

Meantime, U.S. West Texas Intermediate (WTI) crude futures gained $1.48, or 1.79%, to settle at $83.98 a barrel, not far off a seven-year high hit this week. 

The contract gained 1.8% on the week and was up for a ninth straight week.

Also on this morning, oil prices climbed, extending pre-weekend gains to hit multi-year highs.

In fact, U.S. West Texas Intermediate (WTI) crude futures rose 62 cents, or 0.7%, to $84.38 a barrel at 06:46 GMT, touching their highest since October 2014 – $84.76 – earlier in the session.

Brent crude futures increased 56 cents, or 0.7%, to $86.09 a barrel. 

The contract earlier hit its highest since October 2018 of $86.43.

On the financial side, the S&P 500 and Nasdaq closed lower on Friday as disappointing quarterly reports from Snap Inc and Intel Corp put pressure on the communications and technology sectors and investors turned skittish as Federal Reserve Chair Jerome Powell discussed stimulus tapering.

The Dow managed to end the day with a record closing high for the first time since Aug. 16, but all three indexes had lost ground in morning trading while Powell was speaking and went on to pare losses in a choppy session.

Thus, the Dow Jones Industrial Average rose 73.94 points, or 0.21%, to 35,677.02, the S&P 500 lost 4.88 points, or 0.11%, to 4,544.9 and the Nasdaq Composite dropped 125.50 points, or 0.82%, to 15,090.20.

Still, all three indexes notched a third straight week of gains for the first time since early July, with the S&P adding 1.6% for the week while the Dow climbed 1.1% and the Nasdaq advanced by 1.3%.

Meantime, the U.S. Dollar Index decreased from last week’s 93.94 to close at 93.57.

Coming back on grains market, US rainfall maps have built up even heavier for the eastern Corn Belt, with a solid 2-4″ now forecast for much of that area, bringing more expectations of extended harvest delays.

Meantime, SRW wheat areas should benefit from the moisture, but with SRW plantings still running behind average there are some concerns that further delays will cut into planted acreage intentions.

Additionally, amid the rally in wheat prices, over a thousand certificates of HRW were confirmed cancelled which raises questions about protein demand and availability in the cash markets.  

Indeed, while high-pro spring wheat scales remain mostly flat, there’s been continued demand for high-pro HRW.

On the other hand, speculation that high input prices will drive 2022 acres down is keeping prices firm both for corn and wheat.

In contrtast, soybean prices moved moderately lower last Friday as traders attempt to weigh strong demand fundamentals with the possibility that more fields will switch to soybeans in 2022 if fertilizer prices stay this high.

In this context, corn basis bids were steady to weak across the central U.S. after tilting 1 to 6 cents lower at four Midwestern locations on Friday.

Soybean basis bids were steady to weak , spilling 8 to 14 cents lower at three Midwestern locations while remaining unchanged elsewhere across the central U.S..

As for wheat, HRW basis was up in both the Gulf and Pacific Northwest (PNW) past week as higher HRS futures prices incentivized buyers to seek HRW as a substitute.

That increased HRW demand and driving up HRW futures prices.

From South America, rains in Brazil largely have been positively received, current maps adding another two inches across next week for most soybean areas.

Argentine corn was pegged at 26pc planted.

As for wheat, recent rains in key production regions of Argentina has the country’s Buenos Aires Grains Exchange predicting a record wheat harvest this season.

However, it should also be noted that the Argentinian harvests are showing very disappointing yields for the time being, and unfavorable weather conditions are further eroding the country’s production potential. 

Harvest has barely begun, with 2% progress, and will continue through January.

But the Buenos Aires Stock Exchange has withdrawn two points from its ratings of “good to excellent”, which fell to 44% (10% last year).

On European market, French farm office FranceAgriMer reports that 32% of the country’s corn crop has been harvested through October 18%, up from 18% a week ago but remaining far behind 2020’s pace of 75%. 

Heavy rains late last month pushed back this season’s harvest timeline, and crop development was already running about 10 days below the prior five-year average. 

Eighty-nine percent of the crop is rated in good-to-excellent condition, down a point from last week.

Meantime, 40% of the 2021/22 French soft wheat acreage has been planted through October 18, up from 13% last week and similar to 2020’s pace so far. 

Winter barley planting progress reached 59%.

Meantime, strong international demand in a context of tight balance sheets and soaring energy prices are boosting European cereals.

In deed, we have seen new sharp rise in prices Friday with new highs reached in wheat on Euronext.

From the Black Sea basin ,dryness in the Black Sea region finally attracted some broader attention. 

Extended run models began to add a few chances of rain for southern Russia but very limited currently.

Meanwhile wheat prices continue to rise in the Black Sea basin, corn prices are slowing down, in particular thanks to drier weather, allowing for progress in harvesting operations.

On the other hand, feed barley prices remain firm, thanks to good export activity. 

Thus the optional origins on the part of Tunisian buyers could turn to Ukraine.

Meantime, Ukraine 2021 grain harvest 76.5% complete at 56.3 mln T.

The volume includes 32.3 million tonnes of wheat, 9.6 million tonnes of barley, 11.2 million tonnes of corn and small volumes of other grains.

From Australia, weather maps added some more moisture for the east coast later this week in the newest runs. 

There is a range of 10-20 mm rain forecast from the Mallee northwards through to northern NSW, and similar in the Wimmera region.

Meantime, winter crop harvest in Australia’s eastern cropping zone is progressing southwards with receival and storage operator, GrainCorp, released its first intake figures for the season, so far totalling 857,400 tonnes.

Harvest in Central Queensland has begun to taper off with receival sites starting to wind down while further south around the Darling Downs, Western Downs and Goondiwindi districts deliveries are ramping up with storage sites taking in predominantly wheat.

Rain events in Queensland over recent weeks have slowed receivals in many areas.

In north west NSW, some sites across the Moree and Burren Junction clusters are now receiving grain.

At this early stage the quality indicates a normal receival split across wheat grades and very good quality for barley.

GrainCorp reports that Flex sites such as Noondoo and Wallumbilla in Queensland are receiving grain for the first time in 10 years and Kiacatoo in NSW is ready for grain for the first time in seven years.

On the international scene, Tunisia would have bought 50,000 t of milling wheat at $ 373.65 / t C&F and 50,000 t of optional feed barley at $ 346.05 – 349.22 / t C&F .

TCP Paksitan received different offers in its today wheat tender.

Later in the morning we will see, the results.

We wish you a good day and a good start to the week.

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