Tuesday reversal is not a rule by any means market finished higher once again. And contrary to Monday, market did not correct before the close. If the rains in Argentina are calming down, it’s expected more rain to come in the next couple of weeks, so once again Soybeans were the star of the day. In the US, market cannot decently talk about diminishing corn yield as the seedlings have been more or less twice as fast as last year But they do anyway and speculate about the fact corn planting could slow down in the next couple of weeks…. It begins to be ‘slightly’ farfetched! And the market is switching to another story… Delay of spring wheat planting due to rains. Well… We’ll see… But delaying the wheat planting due to rain is not the worst things that can happen, at lease when seeded, soil moisture will be good… US dollar weakness also helped the move. Funds bought 8,000 Corn, 14,000 Soybeans and 5,000 Wheat. MATIF failed to follow US markets but closed above the session lows. Higher euro was providing some pressure but also, there’s a point where MATIF won’t be able to follow indefinitely US market higher considering how heavy the fundamentals are and how optimistic one can be about the next crop.


Night session is overall in red territory apart from Minneapolis Wheat. That’s spring wheat… Delays, blah blah,… MATIF is doing an adjustment with US markets this morning in a very thin volume, it seems there’s a lack of motivation there.


In Brazil, government there’s now a quota pf 100kT of corn import outside Mercosur (usually subject to import tax), in a bid to give an advantage to US corn compared to Argentinian corn. However, it’s not sure the incentive will work. BRF (Brazilian food processor) said they do not expect to import from outside Mercosur.


Indonesia is setting the palm oil export tax to $3/T in May, it’s the first time since October 2014.


In Russia, Agriculture Minister said wheat export reached 21.76MT so far this season, an increase of +9.90% from the season before.


After an over caution March MARS report, EU Environment Agency’s April report looks much better this month and is actually pretty encouraging for wheat, corn and rapeseed. The only areas of weather concerns (with rain deficit) are the south coast of the Baltic sea, west and north of Black Sea and Hungary and Slovakia. So as far as the winter crops are concern, this is pretty safe. However, in France it is pretty cold and some negative temperatures are recorded at night, not massive concern though. Also, snow was reported in Scotland. It’s not unusual to have one wave of cold during the spring and this should be the last event, summer is coming fast in the northern hemisphere. Anyway, MARS raised its 2016 EU soft wheat yield to 6.11T per hectare, +2.3% from their previous estimates. Winter barley is pegged at 5.97T per hectare (+2.6% versus their previous estimates), rapeseed at 3.35T per hectares (+1.2% versus their previous estimates). Sugar beet is the only yield cut (-0.6%) but is pretty marginal and market is likely anyway to be oversupplied in the next few years due to the EU move on sugar policy.


Jordan cancelled tender. This is the sixth time in a row, traders are not massively keen on the tender quality control and payment terms. We’ll see if the tender terms are eventually revised because it might become an issue should this situation last. Japan is struggling as well with the feed wheat and barley tender, they are not receiving any offer but it’s only their Buy and Sell (SBS) tender, so no real concern there, they have otherwise no issue in their regular food wheat tenders. South Korea Millers are seeking Australian and US wheat. Egypt has bought 99,646T of local wheat since the start of the new season.


Freight index BADI, Baltic Dry Index, has reached the zone above 700 and is now up +47.28% YTD. Oil is on the rebound of more than 2% and Gold also (following weaker US dollar).


FOMC day… And nothing else will matter… Well, most probably not actually, market is widely expecting the next rate hike to be in June, however, we’ll see if in the statement there’s more hawkishness than expected, the surprise could come from there.  With US crude oil inventories a couple of hours before, this could lead us to an interesting day on the EURUSD side. It’s currently trading just above 1.13. No surprise on the UK preliminary GDP, +0.4%, as expected. For the insomniacs, BoJ might provide some entertainment during the night!

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