What did I miss? Taking Easter holidays and you miss a bit of fun indeed! Quick flashback, USDA WASDE was bearish overall but market was disappointed it was not more bearish, a bit picky to be honest.

Wheat Old Crop: The main change comes from EU, total use is cut by -1.13MT. World Ending Stocks are up +1.45MT

Wheat New Crop: No major change apart for obviously beginning stocks *+1.45MT) and US lower consumption (-0.95MT). World Ending Stocks are up +2.32MT to 252.26MT, 33.57% of the production, 34.05% of the consumption, there’s a massive buffer, from one crop to another stocks increased by +10.52MT with a huge issue in Europe (-15.34MT) and North Africa (-5.78MT), so if there no major issue this year, if Black Sea is performing, it’s not -5MT less in the US which is going to be a game changer, and as everything is going well at the moment, we’re potentially heading to another tough year for farmers.

Corn Old Crop: World production is risen by +1.47MT to 963.32MT. Ending Stocks are up +0.96MT as consumption is adjusted by +0.62MT.

Corn New Crop: South America was obviously the focal point. Argentina +1MT to 38.5MT, Brazil +2MT to 93.5MT. Also to be noticed Mexico +1MT to27MT, South East Asia +1.18MT to 29.49MT and South Africa +0.4MT to 15MT. Total world production is up +4.52MT to 1,053.76MT… Really picky not to be satisfied on the bearish side! The reason is on the demand side. Consumption is also seen growing indeed, +3.18MT worldwide. So ending stocks are only up +2.3MT to 222.98MT, 21.16% of the production, 21.39% of the use. Production grew +90.44MT from one season to another, stock grew 11.15MT from one season to another. Greater production triggered greater demand, however, tough to see that 89.89% of the increase in production will trigger new use, cannot keep it infinitely, it is not that elastic.

Soybeans Old Crop: No major change, ending stocks are up +0.54MT.

Soybeans New Crop: World production is up +5.18MT to 345.97MT, led by Brazil (+3MT to 111MT), Argentina (+0.5MT to 56MT) and Paraguay (+0.93MT to 10.1MT). The total use is increased by +0.72MT, led by Brazil (+0.45MT). So Ending Stocks were raised +4.59MT to 87.41MT, 35.27% of the production, 26.30% of the use, stocks rose +10.28MT from one season to another (production rose by 32.95MT and use rose by 17.83MT, once again, tough to see more production triggering more demand indefinitely).

So last week ended up across the board, only MATIF Rapeseed in US dollar and SoyOil were down (respectively -0.30% and -1.36%). The rest was up: ICE Canola +2.83% in US dollar, Soybeans +1.43%, SoyMeal +3.28%, Corn +3.20%, MATIF Corn +2.27% in US dollar, and Wheat was the usual mess: +1.36% in Chicago, +1.30% in Kansas, +2.32% in Minneapolis, +1.73% in MATIF in US dollar, +0.65% for the CME EU in US dollar and +2.14% for the London Feed in US dollar. EURUSD was up +0.20% last week, GBPUSD +1.21%.

 

The CFTC COT included the USDA WASDE and now everything is short. On the week ending Tuesday, funds sold 8,130 Corn, 30,455 Soybeans and bought 4,375 Wheat. Funds are now short 134,459 Wheat, 158,417 Corn and 29,733 Soybeans… This is an aggregated 322,609 lots of short! Short covering on Wednesday and Thursday (Market was closed on Friday) as funds were seen buying 18,500 Corn and 13,000 Soybeans while they were back on the sell side on Wheat for 1,500 lots.

 

US Export Inspections were no surprise, similar patter since a few weeks. The soybeans negative momentum is keeping on, with 430.9 it was actually the lowest since a while but still above the proportional weekly split as 342.6kT per week is needed. It’s still in a seasonal advance compared to last year and the long term average with only 12% remaining to export during the last 20 weeks. There is more room for corn and inspections were at 1,328.1kT, soon the average weekly split will be below 1MT if good numbers continue to be published (currently, corn need 1,031.6kT on average per week). It is still in a seasonal advance as 64% is completed versus 45% last year and 59% on the long term average. Wheat issue is shaping up slowly as the inspections were barely reaching the needed average. With 671.9kT, 675.8kT is needed per week but only 7 weeks are remaining! 17% of the target is still to be completed while it was 16% last year and 15% on average. However, there’s a buffer for non-reportable exports, so wheat is likely to just reach its target or miss it by no more than a couple of hundred thousand tonnes.

 

Crop reports are back! 6% of the corn is planted in the US, versus 3% last week and 9% on average. Spring wheat is 13% planted, versus 5% last week and 21% on average. So a bit of delay but there is plenty of time to catch up, absolutely no worries. Winter wheat is getting better by +1% to 54% G/E.

 

Back from Easter, it was a softer day yesterday: -2.25 cents for Soybeans, -4.50 cents for Corn, -8.75 cents for Wheat in Chicago, -11 cents in Kansas and -1.50 cent in Minneapolis. Minneapolis premium is back to significantly above $1, to 107.75 cents over Chicago and 112.50 cents in Kansas. Kansas closed -4.75 cents below Chicago. CME EU and MATIF were both flat.

 

Soybeans and Corn were down again today, maybe scratching their head at the USDA WASDE, finally it’s a bit bearish, isn’t it? Soybeans were down -7.25 cents and Corn -4.75 cents. Wheat is a bit contrarian and was +1.50 cent on the close in Chicago, +1.75 cent in Kansas and +10.50 cent in Minneapolis on planting delays. MATIF was down -€1 and CME EU was just ticking down.

 

The fundamental event of the day was clearly the UK’s General Election called by MP Theresa May, GBPUSD is up +2.23%! Theresa May hopes to wipe out Brexit opponent from the parliament. And market believes it will happen and will enable the UK to have a better deal as there will be less domestic shambles.

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