- Another day of lower prices in Chicago despite early attempts to reverse yesterday’s losses. Cash basis for soybeans would appear to have eased (or collapsed according to some) and corn movement in the tight old crop positions appears to be somewhat easier. The outlook for benign weather conditions is encouraging old crop supplies onto the market at last, taking advantage of what might well be the tail end of some historically high old vs. new crop premiums. Fund selling was, once again, reported to be a feature adding to the weaker tone.
- Egypt has, for the third time this month, bought 240,000 mt of wheat, all Black Sea origin, with Romania supplying half and the remainder split equally between Ukraine and Russia. This brings their purchase total for July to 720,000 mt. The price paid was reported to be over $4.00/mt above last week’s successful tender prices despite a drop in CBOT and Paris prices of more than 2% over the same time frame.
- There appears to be an increase in buyer interest in wheat with Algeria reported to have purchased 400,000 mt Nov ’13 shipment from France as well as Iraq, Bangladesh, South Korea, China, Jordan and Japan all reported to have concluded deals since the last Egyptian tender (according to Stratégie Grains). The lack of competition to Black Sea suppliers was evident in the line up of offers, presumably giving Black Sea sellers confidence to escalate their offer levels. Egypt is expected to import something in the region of 9 million mt of wheat in the 2013/14 season.
- Today the Russian Grain Union announced that it expected the Russian 2013 wheat crop at 45 to 48 million mt, well below the AgMin forecast of “a minimum 50 million mt”, which was issued earlier this week. This news, added to the belief that China will import more wheat than in previous years, has provided some support to wheat markets, in spirit if not in substance as closing levels were lower.
- In rapeseed, Oil World have reported Ukraine’s “excellent” yields being experienced across most regions as harvest reaches 90% complete. They forecast a crop of 2.1 to 2.2 million mt vs. 1.3 million mt last year. In the absence of export taxes (at this time) it is entirely feasible to anticipate exports amounting to nearly 2 million mt with a small volume being crushed domestically. Russian rapeseed harvest, although not as advanced, is reported to be yielding better than last year with an anticipated 1.3 to 1.4 million mt output vs. just over 1 million mt last year.