- Key today was ECB President Mario Draghi’s announcement that €60 billion/month would be injected into the Eurozone economy in bond purchases in an attempt to kickstart growth. This level on injection was greater that initially anticipated by the market, which looked for €50 billion/month. Market reaction was mixed but when all said and done the US$ rally persisted with little, if any, sign of slowing as the US remained the “safe haven” given its relative economic stability.
- Wheat markets received some support from agreement reached between the Ukrainian government and traders to limit exports to 1.2 million mt between now and the end of June. Whilst this is now agreed, the reality is that this volume is little different from the Jan/Jun export pace of recent years. Prior expectations were for exports to be in the region of 1.5-1.9 million mt. The key question that now remains is with shipments currently around 8.5 million mt, and feed wheat at least $40 over corn, where are they going to sell 3.1 million mt of wheat?
- Matif wheat failed to make any significant gains despite a 200 point drop in the €uro and another big week of EU wheat exports in which Brussels granted licences totalling 815,246 mt bringing the season total to 17.05 million mt. This is close to ½ million mt (2.7%) behind last season’s pace.
- CBOT markets were described a choppy with traders struggling to get to grips with the ECB announcement, strong US$ and crude oil, which continued what seems like its relentless decline dragging both gasoline and ethanol with it. The latest US update shows stocks of ethanol, crude and gasoline modestly increased week on week and the market is still looking for a price at which stock levels will begin to decline.
- S American weather forecasts show little change and favourable; Argentina is forecast to get the dry conditions it needs and rains look likely to persist across C and N Brazil in the coming week.