Generally grains were flat in overnight trade and oilseeds were lower. Chicago soybean futures found no love after recent good rains across much of the South American crop.
Soybeans also came under pressure from a sharp decline in palm oil which slipped 12.5%. Poor Malaysian palm oil exports are also indicating a building in stocks but the current key to the oilseed market is the improved conditions in Argentina.
As per usual the weaker bean and palm values rippled through to both ICE canola futures and Paris rapeseed. ICE Canola was off C$5.20 on the nearby and Paris off the equivalent of AUD$2.50 / tonne.
On the flipside there is good demand for ethanol with the higher oil prices. This is resulting in increased corn and wheat consumption for ethanol production. Current values of feed stocks and higher oil prices has seen plants which have not been operating for a while now able to turn a profit once again. More demand is a good thing right now.
But what about the supply side, well believe it or not there is a good mix of bullish and bearish news out there. For wheat we see the recent cold snap in the US causing a few issues. There are reports of widespread winter kill from southern Nebraska as far south as northwest Oklahoma and even parts of Texas. This includes large areas of Kansas. Record cold on young wheat with little snow cover could see some patchy crops emerge in the spring. A similar scenario is also unfolding in parts of Europe and the FSU.