Gleadell Daily Grain Comment - 16 July 2018

[ADM Agriculture]

• US markets close – soy lower on forecasts of favourable weather for the Midwest. Corn lower on favourable weather forecasts. Wheat higher as supplies from competing exporters continues to decline, with talk of trade shifted to the US late in the season.
• For the w/e 10th July CFTC report showed managed money trimmed their Chicago wheat short position by 1679 contracts (now seen 246 contracts short), while extending their Kansas City wheat long position by 2500 contracts (now seen 19748 contracts long).
• For the w/e 10th July CFTC report showed managed money extended their Chicago corn short position by 38566 contracts (now seen 104376 contracts short), while trimming their Chicago soybean short by 430 contracts (now seen 53247 contracts short).
• US Midwest weather forecast sees good rains first half of the week, with another round of rain seen for the southern areas at the end of the week. Temperatures seen in the 80’s with a few 70’s building into the region next week.
• US 11-16 day forecast still sees above average temperatures and below average precipitation for most of the Plains, with average precipitation and close to average temperatures seen for the Midwest.
• For w/e July 5th, all wheat sales are running 30% behind a year ago, shipments 45% behind, with USDA forecasting an 8% increase y/y. Corn sales running 4% ahead y/y with shipments 4% behind y/y vs USDA’s 5% increase y/y.
• Wire stories report China’s retaliatory tariffs on US soybeans have driven down prices and triggered a wave of bargain shopping by importers in other countries stocking up on cheap US supplies.
• Crops across the province of Saskatchewan (Canada) are advancing nicely, with 81% of the fall cereals, 77% of the spring cereals, 75% of the oilseeds, and 79% of the pulse crops at their normal stages of development for this time of the year.
• The estimate for Argentina’s drought-hit corn crop may be cut further from the 32mln t currently expected, the BAGE and main farmers’ group said, citing reports of possible lower yields.
• Argentina’s 2018-19 wheat harvest is expected to be a record 20mln t, the Rosario exchange said citing a higher than projected planting area and good ground moisture levels at the time of sowing.
• Russian Ag Ministry sees 2018 wheat crop at 64.4mln t, although the ministry kept its 2018 grain crop forecast unchanged at 100mln t.
• Black Sea wheat prices being offered into Asia rose last week as supplies tighten and importers seek larger volumes from Russia and the Ukraine following a drought in traditional supplier Australia.
• French farm office AgriMer, estimates 20% of soft wheat harvested by July 9th vs 3% a week earlier, also estimating 72% of the crop in good/excellent condition vs 73% a week earlier. Sees 73% of the corn crop in good/excellent conditions vs 74% a week earlier.

Last Trade Settlement:

London Nov ’18 Settle £169.50/t – up £1.95/tonne from previous close

Paris Dec ’18 Settle €185.50 – up €2.25/tonne from previous close

CBOT Nov ’18 Soybeans Settle - $8.3425/bushel – down 15.00 cents/bushel from previous close

CBOT Dec ’18 Corn Settle - $3.5475/bushel – down 5.50 cents/bushel from previous close

CBOT Dec ’18 Wheat Settle – $5.1250/bushel – up 11.25 cents/bushel from previous close

Currency Today:

GBP EUR 1.1330

GBP USD 1.3250

EUR GBP 0.8825

EUR USD 1.1695