The markets put aside last weeks finish, and soybean and corn futures headed higher as the warm weather that sparked last weeks rally began to hit home, and the forecasted rain evaporated. The northern and western Corn Belt areas are starting to show some signs of crop stress due to lack of moisture, whilst soybean crop development is expected to be hampered during this period considered by most to be critical for determining yield. Pro Farmer began their Midwestern crop tours on Monday, and their daily reports will be keen awaited by traders looking for more solid on the ground reports of crop conditions. The wheat market followed its row crop cousins, and put on a reasonable gain for the session, but demand is still seen as limited for US origin wheat, as cheaper EU and Black Sea region wheat seem to be finding homes in most of the recent tenders.
Traders in the cotton market took some profit overnight, following the stronger advance of last week. The December contract has continued to trade higher on the back of the spec fund continued buying, as they continue to build their long market positions. The USDA improved crop conditions in most US states by a percentage point or two following rain across the southern growing regions. The US crop remains delayed, and US supply is expected to remain tight for the near term. The markets look to be on an upward trend technically, but fundamentally, demand is almost non-existent at the moment, forcing Aussie basis lower.
The Aussie dollar has continued to trade a reasonably tight range of 0.9050 – 0.9225 for the past couple of sessions. Data which may have some effect on our currency has been limited, but this afternoon will see the released of the RBA’s minutes from the August rate cut meeting. Most believe that the minutes will show an openness the cut rates again, but the determining factor of when, will be no clearer.
New crop prices have taken a jump up in the Brisbane Port Zone, with new crop APW hitting the $303 or better, port equivalent price. The premium that the Newcastle Port Zone had held in the new crop market has evaporated with Newcastle prices $294 port today. The domestic end users in QLD are looking for coverage, helping to push prices higher over the border. The new crop 70/10 market remains extremely firm in both Northern NSW and Southern QLD, with the harvest slot starting to fill up, demand for post harvest is starting to heat up. New crop canola has benefited from a rally in both Soybean and Canola futures internationally, with new crop hitting $540 Newcastle, the best numbers seen for a good couple of weeks. The pulse markets remain mostly quiet, but we have seen some slight increases in the chickpea bid delivered Darling Downs packers. Local packers are still cautious with their chickpea bids, on the back of limited demand, with chickpeas still bid around the $350 levels, whilst faba’s are a few dollars softer to around $385. For our growers west of Narrabri, we have interest in APH2 and H2 that you may be holding in Graincorp and Grainflow sites, call the office if you would like to price your warehoused grain, ahead of increased warehousing fees starting in September.
The AgVantage team looks forward to catching you with any growers heading to Ag-Quip. Call in and meet the team at Site F24, and have a chat about the markets, and our exciting new product offerings to help you manage your stored grain on farm.