CASH MARKET WRAP: The calm before the data release

Wheat

Wheat cash prices largely flatlined over the course of the week with wheat from the Americas stable in the face of higher futures because of weather issues across the Midwest US, while Black Sea and Australian origin rose on currency and corn.

With Argentinian 12% wheat static at $236/mt FOB and priced out of the equation, exports remain sluggish, while Australian wheat also remains unfavourable economically as a stronger AUD underpinned a $1/mt move north for APW 10.5% to $241.25/mt.

In Russia, cash prices for 11.5% FOB out of the Black Sea moved higher by $3/mt to $187/mt over the course of the week, due to slow farmer selling and a stronger rouble.

And in Ukraine the feed wheat price was underpinned by higher corn prices, which has seen some switching to the grain – rising $3/mt to $183/mt FOB Black Sea.

Corn

High water hampered barge movements on the Mississippi River this week, sending CIF barge values for June arrivals spiking by 25%, with the fresh interruption to supply starving the US Gulf of corn and washing out export hopes for the final months of the marketing year.

Corn prices over the week were largely stable as July futures reached equilibrium around $4.40/bu, but fresh supply issues hit South American production and saw FOB Up River and Santos prices climb relative to the US.

Argentina’s FOB Up River market remained the origin to beat, with prices climbing $3.50/mt to $183/mt – equating to a 13 cent premium to July – some $17/mt below US Gulf FOB cargoes, versus $22.75/mt at the start of the week.

For the FOB Santos market, a July 2020 trade was heard at 3 cents under the July futures contract, with bids for August 2020 loading heard at 22 cents over September.

The values reflect the steep inverse between the July 2020 contract – the last of the weatherbeaten 2019/20 marketing year – and the September 2020 contract, heralding the 2020/21 crop.

Soybeans

Futures started the week by pushing into the green as rain turned core planting areas in the Midwest wet over the weekend.

But gains were short-lived as the board turned red Tuesday amid fears over an anticipated spike in current US soybean inventory levels ahead of the USDA stocks report Friday and bleak prospects for a speedy resolution to China-US trade spat as Trump meets with Xi at the G-20 Saturday.

By Thursday, the July contract hit a two-week low of $8.83/bu.

In the cash markets, offers out of the US Gulf for July loading held at 75 c/bu over July futures and loading values on a flat price basis fell $10/mt on the week to $348.25/mt

In Brazil, Paranagua premiums slid despite a weaker board because of lower demand from Chinese buyers.

Santos cargoes for loading in July on a flat price fell less steeply than US Gulf cargoes, hitting $367/mt Thursday, down from  $372.50/mt last Friday.

The APM-6 China price was assessed 190 c/bu over August futures on Thursday, equating to $400.25/mt.