International Grain, Seed and Fertiliser Merchant

Tuesday 19 December 2017

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Daily Grain Comments

  • US markets – soy lower on beneficial Argentine rains although not as extensive as forecasted. Corn marginally lower as US supplies/weak exports balances reluctant farmer selling. Wheat higher on short covering, continued dryness concerns and Informa acreage numbers.
  • CFTC reports showed that a/o 12th December managed funds extended their Chicago wheat short by 38871 contracts (now seen 157652 contracts short), also extended their short KCBT wheat position by 9819 contracts and extended long Minneapolis position by 2351 contracts.
  • CFTC reports showed that a/o 12th December managed funds extended their Chicago corn short by 36673 contracts (now seen 197192 contracts short), but trimmed their long Chicago soybean position by 33379 contracts (now seen 19755 contracts long).
  • US Midwest weather will be milder with temperatures slightly above normal and fairly dry this week. Below normal temperatures will return during the weekend and into the Christmas week.
  • Hot weather across much of Argentina over the weekend, with rains seen yesterday, although amounts and coverage was less than forecasted. Extended models show less rain for S Brazil and Argentina than first predicted.
  • Informa Economics released new US acreage estimates on Friday, with soy acreage at a record 91.39mln ac (up 1.18mln on this year). Corn at 89.67mln ac (down 750,000ac on this year). Winter wheat 31.09mln ac (down 1.6mln on last year), with all-wheat acreage estimated at a record low of 44.66mln ac compared to last year’s 46mln ac.
  • Australia’s winter wheat crop is most of the way through harvest and is estimated to be down by 35-40% y/y, with industry experts estimating a wheat harvest of about 21mln t. Exports are likely to drop by up to 40% to about 16mln t after last year’s exceptional season.
  • Agrural sees Brazil’s winter corn production falling 11.9% to 59.2mln t from 67.2mln last year, estimating Brazil’s total corn production at 84.1mln t, down from their 97.6mln t last year.
  • China’s corn planting area is expected to have been reduced by 1.33mln ha in 2017 as the country seeks to address excessive corn stocks, according the ministry. Reductions mainly concentrate in areas with low and unsteady output.
  • Egypt’s strategic wheat reserves are enough to meet consumption needs until the beginning of the harvest season in the second half of April, reported the minister of supply, stating stocks of 3.4mln t.
  • India‘s planting of winter crops has been completed on 80% of the total crop area of 54.1mln ha, with higher sowings of pulses and a significantly lower area under oilseeds. Wheat planting is seen marginally behind last year’s number.
  • Russian wheat export prices fell last week, according to IKAR, which indicated the first fall in three weeks following strong internal demand from shippers, with UkrAgroConsult also reporting a fall in Ukrainian export prices.
  • Russian Ag Ministry sees Russia’s 2017-18 wheat exports at 40mln t. Shipments have totalled 19.1mln t so far, with corn exports at 2.1mln t (little changed y/y), barley 3.2mln t (up 80% y/y) – all grain exports reported at 24.5mln t, up 34% y/y.

Last Trade Settlement:

London May ’18 Settle £142.15/t – up £0.15/t from previous close

Paris May ’18 Settle €164.75 – up €0.50/t from previous close

CBOT Mar ’18 Corn Settle $3.4700/bushel – down 0.50 cents/bushel from previous close

CBOT Mar ’18 Wheat Settle $4.205/bushel – up 2.25 cents/bushel from previous close

Currency Today:

GBP EUR    1.1325

GBP USD    1.3370

EUR GBP    0.8825

EUR USD    1.1805

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