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Market Report 31st August 2018

Markets recover somewhat this week following the recent sell-off, as talk of potential Russian export controls helps provide support.

  • Speculation continues to circulate that Russia may look to put in place export restrictions of some kind. Russian ministers are due to meet on Monday to discuss.

  • Exporters have been assured of one months’ notice before any tariffs would be applied – encouraging large early season exports (that combined with the weaker Ruble). Wheat exports this season so far of 8.2mmt are up 60% on last season.

  • Egypt buys another bulk of new crop wheat, largely Russian origin (over 1mmt of Russian wheat offered as exporters seek to secure business while they can).

  • FcStone estimate US corn crop at 177.7b/a (USDA 178.4b/a).

  • Argentina is believed to be considering a 10% export tax on both wheat and corn.

  • Stats Canada place all wheat production at 29mmt, lower than trade expectations of around 30.6mmt (30mmt last season).

  • US funds estimated net short -79k (corn), -61k (soybeans), long 106k (Ks+Ch wheat).

  • Suggestion from Brussels that the EU may be softening its stance on Brexit in efforts to help secure a deal (GBP/EUR still approx. 15% below pre-Brexit vote levels).

WEATHER/CROP DEVELOPMENT