Funds continue to sell wheat while buying corn, and yes, also buying soybeans at Chicago ??. Overnight Chicago soybean futures for the March 24 slot closed a smidge higher, up 3.5c/bu by the close. This caught a few oilseed bears by surprise.
The Winnipeg canola futures contract was having none of it though and still pushed lower. When considering the weaker AUD / CAD the move at Winnipeg is equivalent to roughly -AUD$2.94 this morning. Paris rapeseed futures did reflect the strength in Chicago beans and closed in the green, E5.75 higher on the nearby Feb24 slot. The move in Paris, when considering changes in the AUD/Euro, is worth about +AUD$11.02. This should go a long way in helping to recover some of yesterday drop of AUD$10 in Newcastle crusher bids.
Cash wheat values out of the US Pacific Northwest were lower, generally in line with losses in futures. White wheat values out of the PNW were unchanged. Cash values for Argie milling wheat were flat while Black Sea values were generally flat to lower. When using China as a home Aussie H2 wheat is now just $8.00 higher than US white wheat out of the PNW. Traditionally Aussie milling wheat would pull a good premium over the US alternative, but recent years where AU supplies have been significant we have seen Aussie white wheat trade at a discount, although this did coincide with a drier season in the US PNW. 12.5% milling wheat values CiF China also indicate the Aussie wheat out of WA is cheap, indicated at US$265 CiF China, US$8.00 cheaper than Ukraine, and vastly cheaper than Russian or Argie wheat. US$265 CiF China can be roughly converted to an equivalent XF LPP price of about AUD$302. This indicates that local wheat bids are pulling a decent premium to west coast. But west coast values do appear to be well under where they could potentially be offered at on the export market. WA wheat is cheap and should be buying significant demand at these levels. One could even argue that WA wheat works onto the Downs market at these values at roughly AUD$440-50 (AUD@67c) delivered, so there’s your cap.