World Wheat Prices Are In Freefall…

with not enough import demand and lower Russian prices.  This despite dry US HRW weather and cold HRS and Canada temps.  EU and Black Sea weather is mostly favorable.  Prices in EU are so low to farmers that the EU Commission is proposing to mobilize €56 million to help Poland, Bulgaria, and Romania cope with lower wheat prices.  EU farmers prices are below cost of production.

 

World/US corn futures are lower following wheat.  Trade will be watching todays US ethanol numbers and tomorrows weekly US export sales.  Matif corn futures are making new contract lows.  Dalian corn futures are lower.  Ukraine farmer is getting $3.50 for corn which is raising questions about the size of their 2023 acres and crop size.  Brazil is out of the corn export market but drier weather will allow for increase plantings.  Already Brazil is looking at a lack of storage for both the record corn crop and soybean crop.  This could force farmers to sell corn.  March 14 CFTC commit of traders report showed Managed funds sold 75,000 corn contacts and for the first time since August 2020 are short 54,000 contracts.

 

Canola values continue lower, but this time dragged lower during the day trade in sympathy with steep losses in soybeans, soybean oil and Euronext rapeseed.  Based on the percentage move in rapeseed from its highs to today, there could arguably be additional downside potential in canola, especially given the amount of seed still in the bin.  Today’s selloff was shared between more panic farmer selling (commercial hedges) along with another wave of fund selling with May pushing to another new low for the move (May ultimately closed below its 200-week MA that was resting at $731.50 and November ended the day with a 6)

 

The CFTC will presumably be caught up with its delayed reporting on Friday, not generally a notable fact for the market, other than the massive fund liquidation it has revealed, reaching almost a 300k-contract net sale since mid-February.

The grains and commodities remain out of favor in general with the marketplace focusing on the FOMC conclusion today…

Jordan made no purchase in their tender for 120k tonnes of milling wheat closing yesterday, despite receiving offers from nine trading companies; they issued another one for the same amount this morning, closing March 28.

Brazilian grain exporting agency Anec estimated March soybean exports at 15.4 MMT, up from a 14.9 MMT projection last week; corn exports of 899k tonnes are up from 845k tonnes last week, with wheat exports at 728k tonnes this month, down only slightly from 729k tonnes seen a week ago.

Private analysts Safras & Mercado pegged 2022/23 Brazilian corn exports at 40 MMT, down from 46.6 MMT in the previous season due to stronger Black Sea corridor shipments and a better European crop.

Private analysts AgroConsult pegged ‘22/23 Brazilian corn exports at 51.9 MMT, with soybeans at a record 96 MMT.  They did cut their second crop corn production estimate from 101.3 to 97.2 MMT, with total output down from 130.9 to 125.5 MMT, due to late planting in many states.

European Commission data showed cumulative 2022/23 soft wheat exports at 22.13 MMT, up 8% from last year’s 20.52 MMT pace.  Morocco has the top share so far this year at 3.52 MMT, with Algeria at 3.07 MMT.  EU corn imports through March 19 stand at 19.73 MMT, up 66% from last season’s 11.90 MMT pace.  51.5% of that (10.16 MMT) has come from Ukraine, with another 39.5% (7.79 MMT) coming from Brazil.

 

Mpls wheat -10

KC wheat -15

Chic wheat -17

Matif wheat -6

Canola +3                          what a swing from being down 8 just an hour ago, a fickle market

Rapeseed -10

Soybeans -7

Soybean oil -9

Crude +55

Corn -3

CAD +5