CASH MARKET WRAP: Bulk ags slide on the week

Wheat

With little weather-driven supply concerns, global wheat markets came under renewed pressure from bears this week ahead of the arrival of the new crop.

SRW lost 3% over the week and HRW 4%, with the spread heading back towards decade-long highs while calendar spreads grew as the May contract approached expiry.

Russian milling wheat was the big mover, shedding 3% to hit $216/mt as the market came under pressure from farmer selling ahead of the new crop.

In the southern hemisphere, a weaker Argentinian peso and Australian dollar also drove those origins lower, with Argentina down $1/mt to $217/mt and Australia almost $5/mt lower at $228.50/mt.

Despite the slump, business remained thin for cash, with buyers either pushing sellers to discount further or simply willing to hold out and wait for the arrival of the new crop over the next few months.

Corn

Corn prices slumped 2% over the course of the week hitting futures contract lows and seeing the most competitive origin of Argentina fall from $154/mt to $150/mt as global oversupply fears mount amid a big crop.

Argentina’s basis values are running close to parity with Chicago for August and September loading – just as Brazil’s harvest hits. Depressed Brazilian domestic prices mean cash focus has extended to 2020, where FOB Santos indications are already heard for August to December loading.

The US continues to see weather-borne logistics issues blunt its export prowess, while planting gets underway on a potentially huge area.

Asia buying remained quiet, while some sellers in Ukraine ignored the diplomatic furore to pump out corn to Iran. June shipment FOB Ukraine down $2/mt to $170/mt.

Soybean

Futures fell for three sessions out of five amid a lack of fundamental demand, particularly from China for US beans, with May futures down 3% to hit the lowest since September – at the height of the trade war.

In South America, weaker currencies that have been slammed by political uncertainty and battered finances mitigated some of the fall, but Brazil FOB prices for May shipment were down $7/mt on the week to $327.5/mt. Argentina FOB was $21.50/mt lower at $306/mt.

The expectation of Chinese demand and a collapse in futures pushed FOB US Gulf offers higher on a premium basis 9/cu to 47 c/bu, but flat prices were still down $6/mt to $329.50/mt for May shipment.

In China, a doubling of crush margins spiked crush rates and triggered buying with private crushers buying 44 cargoes so far this month.