US soybeans closed well of the session high but still settled on positive ground in overnight trade. Wheat was mixed with the higher protein HRW and MGEX spring wheat contracts slipping a little while SRW futures managed to close a smidge higher. This was against the trend that many watching the physical market where expecting with the higher grade wheats actually in shorter supply.

The biggest news working against wheat appeared to have come from our own ABARES office which lifted Australian production to 32.64 million tonnes, this is even higher than the latest Canadian crop of 31.7mt, both of which are about 10mt more than what each country should have grown in order to get prices back on track. We will need to see some serious demand soon or new crop production problems arise between now and next April to see any kind of significant rally for those holding wheat.

ABARES also increased barley and canola production. Barley to 10.64mt, a new record and 3.58mt for canola. The trade had factored in a big canola crop and have pushed basis lower to compensate for higher oil payouts over the last couple of weeks.
The sheer size of the Aussie wheat crop will continue to thwart any attempt in prices to rally, especially in the short term while harvest sellers seem happy to sell the market lower.