Two-sided session yesterday in the US, Soybeans ended sharply up in the end: +24.00 cents. Corn also rebounded closing up +4.50 cent. Strong export inspections probably triggered more short covering. Wheat purely followed, ending up +7.75 cents in Chicago, +7.50 cents in Kansas, +4.50 cents in Minneapolis. On the other side of the Pond, the weakness prevailed, with MATIF Milling Wheat ending down -€0.25 and London Feed down -£1.20.
In Chicago, funds bought 2,300 lots of Corn, 17,000 lots of Soybeans and 3,500 lots of Wheat.
Night session is retracing a bit, Soybeans down -5.50 cents, Corn down -1.00 cent, Wheat up +0.50 cent in Chicago, a tick up in Kansas but still down in Minneapolis (-1.50 cent). MATIF Wheat has opened up modestly, a couple of ticks along the curve. Meanwhile, London Feed is still to trade, expected flattish-up.
Finally some good US Export Inspections numbers! 1,157.8kT for soybeans, taking the total this season to 4.72MT, still -35% behind last season though, while full year exports are expected to be only down -3.26%. So it’s encouraging but situation is still worrying. Corn inspections reached 996.6kT last week, 6.84MT so far this year, 75% above last year! Exports are only supposed to raise by +1.50% to 62.87MT so this is a very strong start. Wheat inspections were at 451.0kT, 7.82MT so far this season, -27% from last year but exports are supposed to raise by +13.78% year on year, danger zone as more than the third of the marketing year is behind us.
Soybeans condition deteriorated as only 66% are now rated G/E, -2% week on week. P/VP are now at 11%, +1 from last week. That being said, 38% is harvested, so if it’s the best, the worse soybeans are those still standing in the fields. But to be fair, harvest has been progressing slowly and is now behind schedule. But on the other side, corn harvest is still in front of schedule even if only 5% was harvested last week (39% total). Corn ratings are unchanged, 68% G/E and 12% P/VP. On winter wheat, 65% is planted (+8% from last week) and 44% has emerged. This is a good and early start for wheat.
Japan is seeking 127,688T of food wheat from US, Canada and Australia. South Korea NOFI is seeing 16,000T of corn gluten feed, 12,000T of palm oil kernel expellers and 6,000T of copra meal… And 60,000T of feed wheat. Syria is seeking 200,000T of wheat, last time, they booked it from Russia.
Bad set of data in the US as Retail Sales are missing the expectations: expected at +0.7%, actual at +0.1%. Core Retail Sales were actually negative -0.1% while expected at +0.4%. Today, UK unemployment rate was as expected to 4%and average earnings a tick better than expected to +2.7%. Chinese CPI and PPI were broadly in line to respectively +2.5% and +3.6%. later today EU ZEW and German ZEW expected at -9.2 and -12.3, US Industrial Production expected at +0.2%. EURUSD is trading at 1.1585, GBPUSD 1.3200 and GBPEUR just below 1.14. Market seems to be relatively confident the hard Brexit drama won’t happen… MP Theresa May is going to Brussels, so sentiment might change if she’s bullied like in Salzburg!
Crude Oil is trading at $71.25, ICE Brent at $9.10 premium, market did not panic after Saudi broke a taboo and clearly implied oil would be used as a political tool in case of any sanction (no kidding?!?). However Saudi is now going to admit the interrogation of Khashoggi went a bit wrong and he sadly passed away during the interrogation. Fortunately, one of the bloke randomly around had travelled with a saw… Phew… Case closed, nothing suspicious, this was an accident and the guy with the saw was participating to the Turkish Kebab Cutting World Championship so one can expect he was travelling with its own gear… You would not expect Tiger Woods to rent his golf club, wouldn’t you?