Chicago soybeans continue to push higher, closing with nearby gains of 16.75c/bu (AUD$8.60). The move fuelled by speculation on the S.American crop. Spill over buying was evident in both canola and rapeseed futures but at the current price level canola will struggle to push higher and is more likely to converge with new crop values over the mid-term. This is evident on the basis chart attached as the nearby contract at Paris rolls out. This does raise the question about hedging some new crop with futures, options or physical sales or swaps.

US wheat futures were weaker as the weather map indicates some much needed rainfall for the HRW belt. NOAA predict up to 50mm of precipitation in places and a general 25mm of precipitation across much of Oklahoma and Kansas. The system will bring plenty of snow, as it has further north already. The system will bring very cold conditions to the US and Canada, some parts of Saskatchewan slipping as low as -30C.  With temperatures getting well below -10C across the HRWW belt, snow cover will be crucial to ensure winter wheat survival.

Much of France, Spain and the UK remain abnormally dry for this time of year. Keep an eye on this as the 7 day map indicates little chance of this changing over the short term.
Chickpea prices in India continue to slip away, so far this week shedding around AUD$25 at their local level. Cash bids for speciality crops across Canada, a major producer of lentils and chickpeas, have also taken a significant hit this week. Flax seed seeing “no bids” in a number of locations. This may be the year to play it safe with the more generic commodities.