Markets rally sharply on the week as risk premium is built for challenging crop conditions in parts of US, SA and Black Sea.
US weekly exports reported at 1.9mmt for corn, well above market expectations. Wheat underwhelmed with just 328k reported (450k/week required to meet current USDA targets).
US funds estimated net short 52.8k (wheat), long 210.9k (corn) 124.3k (soybeans).
Saudi Arabia buys 545tmt wheat – believed to be German/Baltic origin. Iraq also announces a tender for 50tmt wheat from US/AUS/Can origin.
Ag Rural cut 17/18 Safrinha Brazilian corn production by 4.5% to 57.2mmt. Total corn output placed at 87.6mmt (USDA 92mmt).
Stats Canada suggest Canadian farmers intend to plant 25.3m/a total wheat area 2018 (up 12.8% on this season).
Sterling will be closely monitored this week - BOE interest rate meeting scheduled for Thursday 10th .
AHDB data shows UK barley usage in animal feed production of 934tmt, up 20.9% on this time last year.
US Corn Belt planting progress increased to 39% complete (above most trade estimates). 44% the 5 year average.
Forecasts for the week suggest light rains are to be followed by heavier towards Friday, potentially hindering field work. Prevent plant dates are 2/3 weeks away, so there still appears a good opportunity for the crop to be planted.
Kansas Wheat Tour estimated average yields at 37b/a versus 48b/a last year and a 5 year average of 41b/a.
US winter wheat plantings improved by 1% to 34% g/e
US spring wheat planting progress increased from 10% to 30% last week (51% average for this time of year). Forecasts for the Northern Plains suggest some rains over the next 2 weeks, though not of enough severity to hinder plantings.
Argentine Corn harvest delays continue, with wet weather expected for much of this week. Extended forecast do suggest drier conditions are upcoming however.
Ukraine corn planting progress reported at 63% complete versus 53% this time last year.
Southern Russia/Ukraine continue to look hot/dry for the next 2 weeks, with little change evident in the extended outlooks for May.
Market strength continues as ongoing weather issues in US/SA/FSU provide enough doubt around 2018 supply to justify additional risk premium.
USDA data due for release on Thursday will be the next fundamental target for the trade. Risk of consolidation pre-report is a possibility given the extent of the recent rally, also bearing in mind the sizeable longs in corn/soybeans.
That aside, US/FSU weather will likely continue to be the key drivers day-to-day, with the ongoing US/China trade situation also likely to be monitored for developments.