The wheat market reversed last week’s late recovery, with nervousness over corn surviving some torrential rain events in the Midwest being pushed aside by the generally comfortable world wheat production. The US winter wheat crop has progressed to around 30% harvested, slowed somewhat by the rains affecting the Midwest corn crop. The drop in international prices saw Saudi Arabia, The UAE and Egypt purchase close to 1Mmt over the last couple of days of multi origin wheat. Corn conditions in the US dropped 2% in the Good to Excellent rating to 74%, and the forecast for further rain look likely to cause some continued flooding and crop destruction. The next important piece of the corn puzzle will be the confirmation of planted area in the 30 June USDA planting and stocks report. The soybean market continues to run its tight nearby stocks race, and the funds helped to push this support to the new crop contract as they begin rolling their positions to the November contract.
Cotton rolled through first notice day with little drama. The local market was mostly unaffected, given most local merchants have already moved the pricing structure to the December contract. Every seems more interested in new crop conditions, which seem to be ever improving in West Texas, while the lack of Indian monsoonal rains have also put planting in the subcontinent behind schedule.
The Aussie dollar found support from the improved Chinese economic data released yesterday, and seems to have found plenty of support in the 0.94 cent range.
The local grains market is still being pressured lower by the continuing improvement in southern crops. New crops prices have stalled their fall, but old crop is feeling the pressure from the liquidation of stocks held as hedges against production. The chickpea market is in a holding pattern, with Ramadan starting on Sunday, no real new demand is expected between now and harvest, and the spread between old crop and new crop reflects the cost of carrying tonnes. Sorghum remains hard to place, and prompt delivery is near non-existent.