The grains markets seem to still be bleeding value, pressured mostly by the continuing pace of corn planting across the US. With another near record crop now forecast, a dramatic change in conditions would be required to change this outlook, which should see an abundance of stock and a loosening in worldwide stocks. Crop conditions in the US Wheat crop dropped off another 1% in the Good to Excellent categories to 29%, but improvement being seen in Europe/Black Sea growing regions, where crop are improving is seen as a backstop for the continued downward trend in the US crop. Soybeans jumped on the technically tight US Balance sheet, with new crop planting picking up pace, stocks are not expected to jump, regardless of South American beans making their way into the US.
Cotton continues to trade a downward trend, making its 9th downward trading day. With July trading sub 90 USc/lb, it is expected by the trade that a number of mills will be fixing their on-call contracts at these levels, but that information will be slow to filter thru. Certified stocks are continuing to grow in US Warehouses, and this is helping to contain the July/December invert, which is now closing in on just 700 points. The 14 day forecast puts rain on the map in West Texas, and this could be just in time for that crop only just going in the ground.
Our dollar has remained bound to the 93’s, but could come under pressure from the release of the US Federal Reserve meeting minutes out later this week, which is expected to indicate a better than expected economic picture, which will hopefully draw some funds away from our currency.
The domestic grains market is riding the fluctuations in international markets, with wheat and barley slightly firmer for the start of the week. Sorghum track markets are firmer for growers with Sorghum1 in the bulk handling system as we close in on the end of the month, and traders are required to make deliveries against track contracts. New crop wheat and barley continue to hold at strong numbers, both track Newcastle and Brisbane as well as ex-farm.