Profit taking seemed to be on the menu at Chicago last night. Wheat, corn and soybeans futures all closing a little lower. Soft red wheat futures were hit the hardest shedding 8c/bu (AUD$4.28/t) on the nearby March contract. Soybeans and corn found enough support from trade deal chatter to keep losses minimal but wheat was always tempting fate when moving higher over the last week. This week’s US sales data out tonight will determine if the higher US values are a major concern or not. The trade are punting sales between 200kt & 600kt, that’s a pretty big range of estimates.

Just as Turkey look at reducing their wheat import tax of 45% because of poor domestic production we see Pakistan predicting a bumper crop of 27mt, 10.3% ahead of last year. The 90day precipitation anomaly for Pakistan is pretty impressive with much of the country seeing 400% – 600% more rainfall this sowing season than average. The short term outlook is dry so it might be a big call this far out but at least the crop is off to a great start. Pakistan harvest their winter wheat around the time we plant our wheat here.

There’s still plenty of confusion and a lack of confirmation surrounding the US/China trade “deal”. The US appear pretty pumped up about it all while I can’t help but think China are pretty happy they have avoided the tariff increases that were pencilled in for this week. China also have not mentioned any specific tonnages but continue to stress that they will buy US product if US products are price competitive.