Has it been raining? Not really. But market lost grounds yesterday and ended down -19.50 cents on Soybeans, -10.75 cents on Corm, -18.00 cents on Chicago Wheat, -19.25 cents in Kansas and -10.75 cents in Minneapolis. It seems like the catalyst wasn’t really the weather as US and Russia still miss significant rains (to be fair first crop ratings for corn and soybeans were pretty encouraging, it’s an understatement but getting too optimistic on the first rating of the season is quite dangerous!), but more like the US shambles on trade war potential. All other things equal, it is probably an overreaction but a good opportunity to justify a profit taking. On the other side of the Pond, MATIF moved down – €2.25 and London Feed -£1.75.


Funds sold heavily in Chicago unsurprisingly, selling 30,000 Corn, 12,500 Soybeans and 13,000 Wheat.


Night session is rebounding with Soybeans up +1.50 cent, Corn +3.00 cent, and Wheat +7.00 cents in Chicago, +6.25 cents in Kansas, +5.75 cents in Minneapolis. In EU, MATIF Wheat is also retracing with +€1.50 as well as London Feed +£1.50.


Winter wheat harvest has kicked off in the US, 5% is completed, just above the 5 year average (4%) and a tad behind last year (9%). Only 37% is rated G/E (-1% week on week), making last year looking like a great year (49%)! 35% is rated P/VP versus 15% last year. Spring wheat is much better: 70% G/E (55% last year) and 4% P/VP (11% last year). And it’s generally the case for spring crops, the lack of rain has been centralised on winter crops area. Soybeans are 75% G/E and 4% P/VP and corn is 78% G/E (68% last year) and 3% P/VP (6% last year), so big spring crops are starting well.


US Export Inspections still shows an issue on soybeans: with 557,7kT last week, only 83% of the target is completed and time is running out! Last year it was 86%, and it should be 89% on average, especially considering the fact exports were cut by -2.96MT on the May USDA WASDE. But corn has shown that hopes are permitted as it is on a very positive momentum: with 1,555.0kT last week, 70% of the target is completed (target that was, to be fair, reduced by -1.72MT on the May WASDE) while the average is 71% at this time of the season (on top of that positively skewed by last year that was 76%). Last week of the season for wheat! With 341.5k, the aggregated total is falling at 23.85MT versus a WASDE at 24.77MT. This is -0.92MT below, however, with the unreportable exports (cross border, Canadian port, small loads,…), we are more or less there.


Iraq has purchased 1.47MT of local wheat so far this season. Their global demand revolves around 4.5MT per year and the remainder goes through tender (still going on for 50,000T nominal, Australian and US is sought) or private buying. Taiwan’s MFIG is seeking for 65,000T of corn, Japan is seeking for 144,522T of food quality wheat from US, Canada and Australia, South Korea MFG is seeking for 140,000T of corn.


Final Eurozone Service PMI was more or less as expected at 53.8. French Government Budget Balance at the end of April was -€54.3b, which keeps improving and helped last month the country to leave the EU deficit procedure. UK Service PMI was better than expected to 54 while US ISM Non-Manufacturing PMI is expected later at 57.9. EURUSD is trading around the 1.17 figure, roughly unchanged, GBPUSD is up trading around 1.3375 and GBPEUR cross-rate is obviously up then, trading around 1.1440. Meanwhile, the UK government sold more or less 10% of its shares in RBS, taking a loss of $2.68b in the process.

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