US grain and oilseed futures continued to push lower last night. All three wheat grades, corn and soybeans all closing in the red. Paris milling wheat futures saw a €1.25 / tonne jump in the December contract but outer month contracts were all in the red. Weakness in soybeans spilled over into both Winnipeg canola and Paris rapeseed futures. Palm oil futures had another softer close, back roughly AUD$7.00 / tonne.

The weakness in wheat is from improved conditions in both the US and Russian winter wheat crops which are nearing the completion of sowing. In Tuesday’s USDA crop condition report US winter wheat sowing was estimated at 91% done, just 2pts behind the 5 year average pace. The condition rating also improved, up from 35/6 G/E the previous week to 38/6 G/E this week. At 44% good to excellent the crop isn’t brilliant, and 18% of the US crop is still rated poor to very poor. The US crop isn’t made in autumn though, it’s made in spring, so there’s a lot of water to pass under the bridge in the meantime.
There’s a myriad of analyst trying to predict what Trump will do to US and global grain markets. I’m not 100% sure if Trump knows what he is going to do day to day, so to project what is likely to happen in 2, 4, 12 months from now due to his policies is pure speculation, something best left to the futures traders.

World wheat prices were generally flat to lower, some a touch higher once the AUD is considered. I like to convert global values to a common end user that Aussie wheat is often sold into. In most cases the Asian market, and then convert those C&F values back to an equivalent price port or farm to compare with local cash bids. There is a little bit of speculation in that equation, no one is about to tell me their exact execution costs, but we can end up with a ball park estimate, and that’s better than nothing. Day to day, when doing this conversion and using spot AUD we see Black Sea values are AUD$2.00 to AUD$3.00 lower this morning. US PNW values are +AUD$1.00 to -AUD$2.00, Argie wheat is up a dollar and French wheat is up AUD$2.00.