US wheat futures ignored the weekly increase in US export pace and instead focused on their disappointment in the latest monthly USDA World Ag Supply and Demand Estimates report which hit the wires last night.
The WASDE showed a slight increase in US wheat ending stocks, up from 18.3mt to 18.98mt. This was all the trade needed to see to start a sell off in futures and take some profit from yesterday.
From an international perspective the report was not bearish, global ending stocks actually falling 560kt to 258.27mt. That’s still too high, but is continuing in the right direction. The world numbers see carry in back 100kt to 271mt, production increased 660kt to 787.36mt. Production gains were generally in the major exporting nations, major importing nations production was left unchanged.
Numbers of interest were a 2.1mt fall in Indian ending stocks from 9mt to 6.9mt. A 710kt increase in N.African ending stocks, maybe that isn’t considering the severity of the drought in Morocco just yet. A 1.7mt decline in Ukraine ending stock, down to just 1.58mt, que the humanitarian crisis. Russian numbers were shuffled around with no net change to starting stocks, production or ending stocks. Australian exports were increased 500kt, countering the 500kt reduction in Argie exports. The increased Aussie exports rolled through to lower ending stocks, now estimated at just 3.07mt, I bet that isn’t all on the east coast.
So was the report bearish wheat, probably if you live in the USA, thus US futures fell. Generally speaking from an international perspective, the report was not bearish, granted, it wasn’t very bullish either. We might see improved basis here, and a sideways international market until we see some surprising production or demand news drive this market one way or the other.
World coarse grain ending stocks were lower, world soybean ending stocks were lower. Soybean futures were a little lower. Winnipeg canola futures was hit hard, shedding C$14.50 nearby and C$13.40 on the new crop. Paris rapeseed did slip, but dollar for dollar not as bearish as Winnipeg canola.