Another soft day yesterday, risk off before the report. Still. Soybeans closed down -1.50 cent, Corn -0.50 cent, Wheat -3.50 cents in Chicago, -3.00 cents in Kansas and -3.75 cents in Minneapolis. On the other side of the Pond, MATIF Wheat was down a couple of ticks while London Feed, helped by lower British Pound (and a lack of liquidity to be fair) ended up +£0.90. CME EU has now 0 open interest and an announcement will surely be imminent as the contract is dead. CME had much better success with the Black Sea swap, open interest is 12,120 lots, mainly on U8 but every expiry from H8 to G9 have open interest.
In Chicago, funds sold 4,500 lots of Corn, 4,000 lots of Soybeans and 2,500 lots of Wheat.
Night session is relatively quiet: Soybeans down -3.00 cents, Corn up +2.00 cents, Wheat +3.00 cents. In Europe, MATIF Wheat and London Feed are just ticking down. The calm before the storm?
Let’s warm up and stretch! It’s a day with some kind of potential… Will this quarterly stock and planting worth the wait? This is a potential market mover: if market is reminded that the S&D are heavy, the sanction could be harsh, if it’s not as bad as expected, the current dip could be corrected swiftly…
To keep us waiting, export sales: soybeans sales were way below estimates (600kt/900kT) with only 387.2kT, while corn and wheat were on the higher range of the estimates. Corn was 1,640.1kT versus 1.2MT/1.9MT expected and wheat was 475kT versus 200kT/600kT estimated… It’s however an ugly picture as commitment to date are -9% for wheat, -25% for corn and -12% for soybeans. Considering exports are expected to be down year on year by -12.36% on wheat, it is not that bad. But for corn, exports in the USDA WASDE are only seen at -2.95% year on year, and -5.00% for soybeans. No need to be a math genius: it still doesn’t add up and export inspections will be highly entertaining for the rest of the season.
To keep us waiting, GASC: GASC is back indeed and no surprise, it will be a Russian game! Out of 10 offers, 7 are from Russia (one from France, two from Romania) and are by far the most competitive. Best Russian FOB is $217 ($234.12 CNF) while France ($225.23 FOB) and Romanian (best FOB $221.06) are too far to compete.
EURUSD is trading below 1.2325, GBPUSD below 1.4075. Stronger US dollar on better final quarterly GDP, +2.9% versus +2.7% expected. Today, UK Final quarterly GDP was as expected with +0.4%, Canadian monthly GDP was down -0.1% (expected at +0.1%). Chicago PMI later today expected at 62.1.
US Crude Oil Inventories were higher than expected with a build-up of +1.6M barrels (+0.5M barrels expected). NYMEX Crude is trading around $64.25 with ICE Brent just shy of a +$5 premium.