Eventless days yesterday and today. Yesterday market waited for the COT. Same old stories, seasonality, weather market but it’s getting better (Rain has come to Black Sea), market seems to wait for a news to move more. Soybeans closed slightly up yesterday, Wheat down, and Corn as usual, in the middle, here on green side. And night session showed the same pattern.
COT has finally been published, and wow. Over the week (Tuesday to Wednesday), funds only bought Minneapolis Wheat, Live Cattle, Heating Oil, Natural Gas, Cocoa, Orange Juice, and Lumber. They sold everything else! Fund sold 83,169 lots of corn and switched to short 58,404, Chicago Wheat increased short to 20,945 lots (selling 2,704 lots) and Soybeans increased short by 31,825 lots to 52,301 lots. Also to be noted, Kansas wheat increased short position to 20,575 (selling 4,247 lots) while Minneapolis decreased short to 7,087 lots (buying 889 lots).
No surprises on the progress and condition report. Soybeans harvest is virtually over, Corn has reached 96%. Favorable weather condition has improved the ratings -1% of P/VP to 10% and +1% of G/E to 52%.
Option expiries did not bring any surprise on MATIF Wheat, 170 and 180 big open interest on puts have managed to contain the market relatively quiet. The main event of the day really was Socomac, owned by Soufflet, stopping wheat intakes. Hat trick indeed! After Sénalia and Nord Céréales, now Socomac! Basically you cannot deliver wheat to MATIF if you don’t have a storage warrant already. MATIF is resisting very well to the lack of demand and only closed small down, and showing a little rebound today helped by a lower euro.
EURUSD weakens indeed and now below 1.07. Events in Paris are probably leaving uncertainty on state budget and consumer confidence. ECB’s action is becoming more likely. On the FED’s side, still on its way – it’s what market thinks – to a hike in Q4.