February 08th

Market Report

London closed up Friday, May +70p (£202.50), November 21 +50p (£165.50) and November 22 +50p (£154.75) For the week, May was - £5.25 and November 21 - £1.70

US markets had mixed trading on Friday but ended the day with corn and soya slightly down but wheat up as trade prepared for Tuesdays USDA report
$ was lower and most commodities higher, oil reaching pre pandemic levels.
Only minor exports announced with corn to unknown (Japan / South Korea ?)
Fundamentals remain bullish, rain delaying Brazilian harvest and corn demand constant with US well place com supply; Chinese Dalian corn remains close to highs. However, non-commercials / speculative traders have 1.22 million contracts the highest ever level; higher even than the 2012 drought year when corn was $8.50 bushel (currently $5.48). This provides for volatile markets and sometimes trade not reflecting fundamentals
Tuesdays USDA report should be bullish with reduced stocks, South American situation and demand , but how much factored in?

US planting intentions have corn acres + 4%, soya + 1.7% and spring wheat + 2.8%; wheat area questioned as wheat price cheap relative to corn

Russia announces floating wheat tax from 1st June with 70% on price balance above $200. The base price is calculated on export prices reported to Moscow exchange, for example the current FOB price for 12.5% protein Russian wheat is $285, $285 – $200 = $85 less 70% = $59.50. Currently tax is 50% / 60% on total price

Argentina bean and soya have both been revised down 1 million tonnes each, Brazilian corn also speculated down.
Canadian stocks also lowered due to active exports with canola thought lowest since 2012