Funds sold 9,500 Corn, 17,000 Soybeans and 3,500 Wheat yesterday in a session that gave the impressions the rebound was clearly out of steam. It was a two sided session indeed with a pretty good range. Market started in a rebounding mode but it faded indeed and reverted strongly and Soybeans were once again the leader: at some point, Q6 was up +18.75 cents and reverted, reaching -43.25 and closed down -39 cents. A pretty nice dance… The movement was similar but in a much lower extent on Corn as U6 topped +11 cents during the session and closed down only -4.75 cents. Wheat, similar story, topped +8 cents and closed down -5.75 cents on U6. Market still lives in the contradiction that everything is not so bad at the moment but just a little catalyst could make the things much worse, but at some points, reality of the situation is kicking back creating these roller coaster. It’s likely to be this way for at least one more month, typical weather market. MATIF was no exception and started the day fueled by fears about crop being just above 30MT, printing +€1.75 and reverted violently, erasing 3 sessions of gains and closing the gap between €159.5 and €159.75 on U6, closing down -€3.25. So finally, the 14th of July session has been pretty active and market followed the US downturn.
Night session was still down on Soybeans (-5 cents), the curve is still in backwardation despite the dip, small up on Corn (+0.5 cents) and wheat (+1.5 cents). MATIF is slightly down, a couple of cents. The end of the day is likely to be about position squaring.
US export sales were really weak on wheat: 317.8kT, above expectations on corn (1,355.6kT) and in line for soybeans to 911.3kT. The amount of unshipped soybeans above 7MT, a level not seen since 20 years, so it better be shipped quickly, let’s keep an eye on export inspections, else, export number will have to be revised. On the other side of the pond, EU cleared 779kT of soft wheat export licenses and imported 215kT of corn import licenses. On the barley side, it was 234kT of exports and 30kT imports on the annual tariff free quota.
German coops sees wheat production to 25.4MT, Rapeseed to 4.94MT. Meanwhile, EU cuts its wheat output estimates by -1.2MT to 145.5MT, France being hit by a -2.7MT cut. Russian government sees wheat crop to 64MT. Buenos Aires Exchange cut wheat surfaces by -0.1M hectares to 4.4M hectares, still +0.8M hectares more than the previous campaign.
On the latest ergot story from Egypt, authority said the latest vessel rejected was above the tolerance of 0.05%, in a bid to give more confidence to traders. Algeria is said to have bought at least 400,000T and it’s said that Baltic and Norther wheat were offered, quite unsurprisingly.
EURUSD and GBPUSD are slightly down. Euro is back below 1.11 while British Pound is still above 1.33 after BoE did not raise the rates, to the disappointment of financial markets but GBP liked it obviously. Oil is still in the range, NYMEX Crude having a $46 handle, ICE Brent a $47 handle. Gold is just below $1,325. Finally, on Freight, Baltic Dry Index BADI seems now to be back on a good bullish trend, now at 745.