The Friday’ close is reflecting quite well the USDA Quarterly Stock Report. Corn and Soybeans ended up respectively +2.75 cents and +8.5 cents as stocks were below the expectations, by respectively -10.95% (8.19MT) and -12.46% (58.30MT) to the average of the expectations. However, this is a very mechanical reaction, year on year, stocks are respectively up +32.12% and +52.79% so we are far from any incident and the rebound was actually quite contained. On the wheat side, stocks were a tad above the average of the expectations, enough to put significant pressure as on top of this production data did not show any surprise and was actually a bit better than expected (fear or hoped). Stocks are down -11.47% year on year to 61.32MT. But with a production of 47.38MT (WASDE will be revised from 47.33MT), stocks are down -11.47% with a crop down -24.62%… No shortage just yet! The amount in stocks represents 105% of the US needs and exports. No shortage just yet indeed! On top of that, the spring wheat production data hasn’t worsen (still down -28.37% year on year, which is not much worse than the all wheat if we look at it with another angle) and was on top of the range of the estimates and allowed a selloff of Minneapolis: down -21.25 cents. Chicago closed down -6.75 cents and Kansas -10.25 cents. On the other side of the ponds, MATIF was a couple of ticks down and London Feed +£0.40. CME EU was flat. In Chicago, funds sold 5,500 Wheat and bought 6000 Corn and 9,000 Soybeans.


More or less everything ended the week in negative territory week on week. On Wheat, the Friday session surely did help! Chicago ended the week down -0.28%, Kansas -1.67% and Minneapolis -1.73%. On the other side of the pond, market was resilient (also helped by stronger US dollar, EURUSD was down -1.17% on the week and GBPUSD down -0.70%) and managed to keep the head above the waterline: MATIF and CME EU respectively up +0.76% and +0.61% in euro (but down respectively -1.73% and -0.57% in US dollar) and London Feed +0.67% in British Pounds (-0.04% in US dollar). Market did not have a lot of time to react after the Quarterly Stock report and could probably catch up today. Soybeans were down -1.63% on the week, SoyMeal -1.11% and SoyOil -4.18%. Corn was one of the rare thing up, ending the week at +0.50%, MATIF Corn +0.32% in euro and -0.85% in US dollar. Canola was down -1.53% in US dollar (USDCAD moved up +1.06%) and MATIF Rapeseed -1.17% in US dollar.


As per the CFTC COT, Reuters estimated funds had been buyers across the board for 6,000 Wheat, 12,500 Corn and 3,500 Soybeans. Funds bought more Wheat and Soybeans than expected (respectively 14,869 lots and 14,573 lots) but less Corn (1,164 lots). Therefore, they decreased their short on wheat and Corn to respectively 64,699 lots and 133,442 lots and increased their Soybeans long to 23,820 lots. From Wednesday to Friday, funds are expected to have sold 4,500 Wheat and bought 7,000 Corn and 8,000 Soybeans.


Night session is softer on Soybeans (-1.50 cent) and Wheat (-3.00 cents in Chicago and Kansas and -6 cents in Minneapolis). Corn is just ticking up. MATIF is ticking down on the open.


EU has extended duty free import quotas for Ukrainian imports of wheat, barley and corn. Saudi SAGOS’s has booked 540,000T of barley, between $211.98/$216.65 for the CNF Red Sea and $220.29/$221.74 for the CNF Persian Gulf (Arabian Gulf they call it hey!). Egypt is keeping discharging the Romanian vessel suspected to contain poppy seeds bought through the GASC… With thight sieving! But good luck to find the seeds, the screenings has to be pretty small so mixed with wheat, one has to shake it for a very long time! Anyway, there’s fears of a new row of difficult rules implementation (like the tried zero ergot policy) if there’s an actual rejection. Story to follow!


Busy week-end and start of the week. In the UK the Conservative Party convention should once again show to the world in what mess the Brexit has led the UK Government and the governing party. In Spain, the ‘illegal’ (well not ‘sponsored’ by the ‘federal’ government) referendum for independence of Catalonia is a 90% ‘yes’, despite police trying to prevent voters to go to vote. So interesting times for Spain and EU there. EU Manufacturing PMI’s were released this morning, better for Spain, worse for Italy and in line with expectation for France, Germany and Eurozone. Swiss PMI was also better, UK PMI was a bit lower than the expectations. Eurozone employment rate later expected at 9%, ISM Manufacturing expected at 57.9 this afternoon. EURUSD is trading down, back below 1.1750, GBPUSD is also down in a similar extent, trading below 1.3315.

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