US corn and soybean futures found some support last night, both a little higher after some heavy selling in the last couple of sessions. Wheat futures in the US were mixed but did trend lower. The soft red winter wheat contract at Chicago was slightly softer, shedding just 2.5c/bu (AUD$1.35) in the December contract. Hard red winter wheat futures were a little harder hit, down 10.5c/bu (AUD$5.70) in the December slot while Minneapolis was hardest hit on the nearby falling 23.25c/bu but shedding just 4.5c/bu (AUD$2.44) for the December slot. The sharp decline in crop condition rating for US spring wheat in this week’s USDA update helped the Minneapolis market stabilise after recent losses.
Fund liquidation continues to weigh heavily on grain futures. The stochastic does signal further selling is likely but we will need to have a close look at the latest CFTC report when it’s available. The last report on the 28th showed a reduction in non-commercial longs of 12,935 SRWW Chicago contracts  (1.75mt). The funds continue to liquidate on the back of recession fears.
The rally in the US dollar isn’t helping US prices either, but it does create a slight buffer when converting last night’s moves to AUD per tonne, changing a possible reduction of AUD$0.81/t on the nearby contract to a plausible improvement of AUD$0.50 / tonne.
Harvest pressure in the USA is seeing cash basis up country stay on the low side. As a result grower sales volume is a little lower than usual.

Russia / Ukraine continues to be a balance sheet nightmare as much as it is a humanitarian disaster. Will eastern Ukraine wheat, approximately 3.7mt go onto the Russian balance sheet, Ukraine balance sheet. If not exported who’s carry in number does this increase. Although Ukraine wheat production is down 32% year on year there is expected to be a large carry in and potentially a large carry out number thanks to choked export channels.