When you have to leave early, on a report day,… Nothing will happen anyway… Then you come back the day after: D’ho! Right time to be hungover… Soybeans ended up +26.75 cents, Corn +14.25 cents and Wheat +5.50 cents in Chicago, +6.50 cents in Kansas an -11.00 cents in Minneapolis. Funds had the buying fever in Chicago, they bought 43,000 Corn, 25,000 Soybeans and 7,000 Wheat On the other side of the Pond, it was much quieter but markets had very little time to digest and they will for sure readjust after the long Easter week-end: MATIF Wheat moved up +€1.00 while London Feed was up a mere two (small) ticks (+£0.10).


So what happened? On the quarterly stocks, wheat was spot on the average of the estimates with 40.66MT, -9.95% from last year. Widely expected and with a -24.61% production, it is actually far from being ugly. Corn stocks were higher than the expectations, with 225.77MT, up +3.09% year on year. With production down -3.59%, one can wonder if exports are not going to take another hit (-2.95% so far year on year). Similarly, on soybeans, stocks were at the very high end of expectations to 57.34MT, +21.17% year on year, it clearly grew faster than the production (+2.22%). Clearly nothing to justify a sharp rebound there.


It’s more the plantings that triggered the frenzies to be honest. Was that justified? The average estimates for corn plantings was 89.42M acres, actual was short by -1.56% (-5.78MT at constant yield), pegging the crop, at constant yield, to 362.15MT, -8.81MT year on year. On Soybeans, it was actually quite short: expected at 91.056M acres, actual was 88.982M acres, -2.28% below estimates, a cut of -2.72MT of the crop at constant yield, therefore, pegging the crop to 117.98MT, -1.54MT year on year. Instead of a +1.18MT growing crop, it would be lower -1.54MT at constant yield. A psychological effect for sure, but if there’s a miss on the export target, this could be transparent. However, this was the real reason of market disappointment. On the other side, wheat plantings were higher than expected to 47.339M acres, a +2.88% rebound from last year, with spring wheat areas increasing by +14.70% year on year, explaining why the Minneapolis premium has been savagely butchered yesterday (-16.50 cents for the premium to Chicago, on K8 it is now back to 127.50 cents, still high though).


So nothing that changes the global picture but there’s for sure a possible explosive situation but everything would need to go bad at the same time: US lower plantings, lower yields on US drought, South America dryness issues, Black Sea,… Possible, but so far, no catalyst has been triggered and it is pure speculation, a pure bet. However, it is now clear that it won’t be another record year and market will have to assess if market should rightly be bullish or if the current overall supply stays very ample.


France AgriMer said 78% of French soft wheat crop is in G/E conditions, down -1% week on week. Meanwhile, 67% of the spring barley is planted, slightly behind last year and areas will decrease. Arvalis said there is no real correlation between planting date and yield, spring weather conditions are more determining. Winter barley is 75% G/E (also -1% week on week) and durum is 79% G/E (-2% week on week).


China sold 8,129T of its wheat imported reserves as it’s getting older and older, probably only good for energy. Nobody wants it as only 0.46%of the stock offed has been sold. But the real transaction news was obviously GASC purchase. Well, no real news really. They booked whatever they could considering their budget and this included the Romanian offers: they booked 355,000T of Russian and 120,000T of Romanian wheat.


Chicago PMI was lower than expected to 57.4, it was expected +0.2 month on month to 62.1 so quite a miss. Tokyo Core CPI +0.8%, Japanese unemployment rate 2.5%, French CPI +1.0%. Nothing much… EURUSD: 1.2325. GBPUSD 1.4055.


Markets closed on Good Friday. Great to digest the report… And the Easter eggs!

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