Soybeans moved up again (+5.00 cents) on the same concerns over South America, H8 closed above $10.25 per bushel. This is a big price considering the current S&D but market fears a hit will happen in Argentina and this won’t be compensated by Brazil. Else, it was a softer day across the board as Corn moved down -2.00 cents, Wheat -8.50 cents in Chicago, -6.75 cents in Kansas and -2.75 cents in Minneapolis. On the other side of the Pond, London Feed was down -£0.50 while MATIF Wheat was down -€0.25. The next weeks will be driven by the US drought, the snow layer in EU and Black Sea in case of a cold snap, the logistic in Black Sea,… The big question mark is the weather then these days… But so far, so good!
In Chicago, funds sold 6,500 Wheat, bought 11,000 Soybeans and were even in Corn. Being the CFTC COT cut-off, market will expect funds to have sold 10,000 lots of Wheat and bought 21,500 lots of Soybeans as well as 7,500 lots of Corn. In other words, the aggregated short could just be gone as funds were short 56,831 lots of Wheat on the last COT, short 10,614 lots of Corn and long 42,869 lots of Soybeans. This would be a significant swing.
Night session is overall softer without a clear trend. If Soybeans are correcting by -2.25 cents, Corn is ticking sideways, Wheat is down -1.75 cents in Chicago, -4.00 cents in Kansas and +1.50 cents up in Minneapolis. So far European markets are expected flattish.
A significant down day and who’s coming? GASC! They are back seeking wheat. It should be mainly Russian wheat again and again. Although, last time, Romanian managed to compete, so it will be under scrutiny again today. Jordan failed to purchase any wheat despite two trading houses offering. They blamed price. With tough and punitive tender spec, you have to pay for it hey! Japan failed to attract on the SBS tender, they haven’t purchase any feed wheat or feed barley. To be fair, they have been quite successful recently with this tender.
German ZEW was better than expected yesterday at 17.8 (expected at 16.0 but down compared to previous of 20.4), German PPI was also better than expected by a couple of ticks to +0.5%. US Flash PMI’s today, expected at 55.4 for Manufacturing and 53.8 for Services. FOMC minutes could bring some fun also, as well as the UK Inflation Hearings. EURUSD is trading between 1.2300 and 1.2325, GBPUSD just above 1.3950 and GBPEUR cross rate around 1.1330.