The weaker Aussie dollar is doing all the hard lifting this morning. The AUD is back against most of the majors, shedding over 1% against the greenback. The Aussie dollar crashed sharply mid session, slipping from 65.44 to 64.9 over the course of an hour and never really recovered, closing just off the sessions low of 64.81 US cents.
Lower oil, gold and copper prices hurt the AUD, as did piece talks for Gaza. At US$4000 / oz gold is now Australia’s second largest export earner after Iron Ore. Warren Buffet once said that gold is a plausible hedge against fear. If market fear is reduced, does that mean gold values should reduce. In theory I guess yes, the big question may be, is the reduction in market fear justified, and if yes what is the true value of gold.
Either way, the weaker AUD is a welcome site for producers this morning. Take a simple conversion of US wheat futures, the move in the AUD was worth +AUD$2.85/t, the move in US futures was closer to -AUD$4.53/t, the net change thanks to the dollar is just -AUD$1.69/t.
The move in the AUD was equivalent to roughly +6c/bu. This has an impact when comparing cash wheat values out of the US Pacific Northwest. For example US spring wheat fell in USD / tonne but compared to yesterdays conversion to AUD farm equivalent we actually see a 40c/t increase in value.
The more expensive the commodity the bigger the influence. Canola for example, ex farm SE Saskatchewan values were CAD$8.81/t lower for a December lift. Yet we see the AUD conversion comparison into the EU market just AUD$1.18/t lower. Paris rapeseed futures were also lower, back €5.00 to €5.75/t in the Nov > Aug 26 months, yet the nearby day to day conversion comparison is actually up AUD$2.43 / tonne.

The Russian deputy agricultural minister has said that Russia will sow approximately 6% less wheat this autumn. It is expected that oilseeds will mainly take the place of wheat acres. Egypt picked up a couple of small parcels on Kazak wheat, test cargoes maybe after a 15 year break since their last Kazak purchase.