It was very much a pre WASDE report type market across US futures last night. The USDA will present their first World Ag Supply and Demand Estimates report for 2024 on Friday night our time. I’ll have a dig into it on the Saturday morning comments.
No one is really expecting any big news to come from the report. January / February are typically non event months. Northern hemisphere crops are harvested or in winter dormancy or yet to be sown, and old crop production is well known.
Southern hemisphere production is also 90% known in regards to cereals. Summer crops in the southern hemisphere may provide some volatility but the production numbers for Brazil and Argentina are being thrashed out on a daily basis this time of year, and the trade will probably discount the January WASDE data as old if it’s not inline with trade estimates.
Thus markets are dead and are likely to remain so short to mid term. Good rainfall across S.America over the last couple of weeks will help later sown soybeans and corn perform. The outlook for the next 7 days is for further falls too. Some models suggest a return to drier weather after that but we’ll stick to 7 day models for now. Lately they are flat out telling us what will happen in 2 days let alone 14 – 30 days.
Chicago soybean futures took the weather outlook for Brazil as a negative and pushed lower, dragging Winnipeg canola down with it. The move at Winnipeg is equivalent to a decline of AUD$7.28 when taking currency moves between the CAD and AUD into account. Paris rapeseed futures kicked the trend in beans and canola and managed to close in the green, up E3.00 on the nearby, a move equal to roughly AUD$6.05 higher in AUD terms.
Wheat and corn futures were flat at Chicago. London feed wheat was a smidge lower and Paris milling wheat a little higher.
Mexican, Canadian and Australia durum were offered to Algeria, handymax values were said to be about US$464 C&F, purchase volume still unknown.