Daily Market Wire November 12, 2021

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The markets continue to strengthen.

    • December contract for Chicago wheat up 9.5 US cents / bu to 812.5 cents / bu;
    • Kansas wheat December contract up 10.5c / bu to 828c / bu;
    • Minneapolis December wheat up 7c / bu to 1053.25c / bu;
    • MATIF December wheat contract up by € 2.25 / t to € 297 / t;
    • December corn contract up 0.25c / bu to 569.5c / bu;
    • January contract for soybeans up 4.75c / bu to 1221.5c / bu
    • Winnipeg canola contract in January 2022 up C $ 15 / t to $ 1,004.40 / t;
    • MATIF rapeseed contract February 2022 unchanged at € 704.25 / t;
    • The US dollar index rose 0.3 to 95.2;
    • AUD lower at US $ 0.728;
    • CAD lower at $ 1,259;
    • EUR lower at $ 1,144;
    • ASX January 2022 wheat up A $ 6 / t to $ 374 / t;
    • ASX January 2023 wheat up $ 7 / t to $ 377 / t.

International

Chicago wheat was, at one point in the session, above 21.75us / bu but still managed to close at 9.5us / bu in the dark. Minni wheat took 7us / bu while Kansas wheat increased 10.5us / bu. Maize has caught up since reporting but only managed to add 0.25 usc / bu to close at 569.5 usc / bu after being higher of 9.25 usc / bu earlier in the day. French wheat was up $ 2.25 / t while Black Sea wheat was priced up $ 0.25 / t. Soybeans increased US $ 4.75 while meal added US $ 1.90 / st. Bean oil was unchanged, Matif canola was mixed, unchanged on February 22, up half percent in the May 22 contract and down half percent in the November 22 contract.

The fallout from Russia’s agriculture minister’s hint that the export tax could be increased continued in global agricultural markets yesterday. In the wake of a largely bullish USDA WASDE report, global traders decided that most of the major wheat contracts were undervalued.

Brazil has approved the sale of a drought tolerant GMO wheat strain developed in Argentina.

The UN has released a report indicating that developing countries will bear the brunt of rising food import costs. Food import costs will increase by 11% for developed countries, but by 20% for developing countries. Although freight accounted for a large part of this increase, it was also noted that rising prices for agricultural inputs, such as fertilizers, will continue to drive up costs.

Cotton futures rose against a backdrop of tight supplies and rising shipping costs. US ICE futures stocks fell 6% on Wednesday, not helped by persistent harvests due to bad weather

Agriculture has been well supported over the past month, with wheat and cotton reaching highs not seen since the mid to early 2000s. However, when looking at relative performance to energy and in equities, performance seems a bit muted. Crude and ethanol clearly outperformed, with crude starting the year at US $ 48 / bbl to close last night at US $ 81.60 / bbl.

Australia

Australian grain markets once again continued to climb.

Cash offers from producers increased from $ 4 to $ 5 / t, wheat markets from 5 to 6 / t. With harvest delays and uncertainty around quality, little cash is coming to the table. ASX Eastern wheat futures were once again active with demand to secure milling wheat contracts.

Barley bids were a bit stronger again. Rapid demand continues to emerge in the market for November / December vessels and domestic demand to fill in the gaps as the stop start harvest continues.

No more rain! Falls continued along the east coast and in South Australia yesterday with rainfall ranging from 10 to 40mm in some areas. This will once again keep the crop at a standstill for much of eastern and southern Australia, while WA will see a lower crop and a clear advance over the weekend.

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