US corn, wheat and soybean futures were all sharply lower in overnight trade. Wheat had been weathering the storm quiet well but was caught up in sharply lower corn and bean futures after the USDA prospective plantings report and succumb to technical selling which saw wheat go from golden child to red headed step kid throughout the session. All three US wheat grades were sold lower with spring wheat futures holding on the best.
The weakness was in part to do with US agricultural fundamentals but the news around export restrictions out of the Black Sea would in theory counter anything the USDA released. The real weakness was indeed spill over pressure from the outside markets on Wall St and other stock markets around the globe as we continue to see the demise of wealth associated with shares and energy. The Dow fell 800 points on the back of the pandemic. Reports of projected US deaths of 100k or more had the market looking for the exit door….. or a ventilator at least.
Corn was caught up in both the higher acres in the US but also in a collapsing ethanol market as diesel and petrol prices in the USA took another beating overnight down 8% and 6% respectfully.
The weaker AUD should buffer us a little but will not be able to cover the total loss by any means.
In countries like India where a 21 day lock down has been introduced just as wheat harvest gets underway the quality of a record crop is now at risk, farmers cannot find harvest help to get grain into storage, it’s a hand on job in India with much less automation.