Overnight, the major commodity markets continued its bearish slant other than cotton. December wheat fell 7c to 656 ¼ Usc/b which pushed to a new low on the back of US equity markets trading down and the US dollar moving lower for the 3rd straight day, mostly against a strong Yen which was up over 1%. Overnight markets were rather negative after it was reported that US wheat was once again shoved aside by Iraq for cheaper cargos out of Australia and Canada. Also, Russian farmers have harvested 31 million tonnes of wheat as of August 6th, up from 24.7 in the same period in 2012. December corn finished down slightly 1c to 458 ¼ Usc/b as  traders see production and ending stocks for 2013/14 edging higher on next Monday’s USDA report, with favorable weather conditions also continuing the bearish slant on the corn market. November Soybeans closed down 1 ½ c at 1165 ¾ Usc/b. Demand from China continues to look strong with another 2013/14 sale reported this morning for 220,000 tonnes. For the week, China has bought 340,000 tonnes of new crop soybeans from the US. Many still believe that the USDA import demand estimate of 69 million tonnes is overstated given that it’s 10 million higher than in 2012/13.

The big mover overnight was cotton with the December contract up 264 points to 88.33USc/lb and the March contract up 170 points to 85.25 Usc/lb. This movement had nothing but technical buys behind it, with no fundamental supply and demand news attributing to this large overnight jump. A simple reminder to the market that the USDA’s current forecast for farm price range for the 2013 US crop is somewhere between 70 and 90 USc per lb, that puts last night’s rally to 88.33 at the high end of the range.

Domestically we have seen some new crop wheat selling activity continue but slowing, with most new crop contracts north of Moree being XF Oct/Nov/Dec pickup at around the $245-$255 which represents great value when compared to system contracts. On the demand side, buyers are now moving away from the harvest delivery periods and securing forward contracts for January to June 2014 deliveries. Most merchants continue to be bearish, and will look to pick up supply out of the system at harvest. Faba beans can still achieve the $400 delivered Goondiwindi or Narrabri at harvest time. With the overnight spike in the market we have seen Cotton prices for new crop hit $500 for the first time, which will see a lot of bales come to the market. Please call the office to discuss any parcels you are considering to market.