Headlines:

  • President Trump’s address House of Representatives and Senate was very well received last night.
  • Paris wheat futures hit seven-month high, helped by Egyptian order
    Paris wheat futures touched a seven-month high after France, at last, gained an order of the grain from Gasc, as the Egyptian group extended one of the biggest purchasing sprees in its history. Paris wheat for March gained 1.3% at one point on Wednesday to touch E174.50 a tonne for the first time, for a spot contract, since July last year. The gain was supported by a strong performance by wheat futures in Chicago, and the purchase by Cairo-based Gasc, grain authority for the world’s top wheat importing country, of 120,000 tonnes of French supplies, amid a 535,000-tonne order. The order was Gasc’s first for 2016-17 of French wheat – which was the authority’s top origin two years ago, despite the extra cost of shipping grain to Egypt from France, compared with from the Black Sea ports of Romania, Russia or Ukraine. “Traders were positive about this first trade to Egypt, allowing wheat [futures] to go up,” Paris-based consultancy Agritel said. While Russian wheat, backed by a boost to supplies from a record harvest last year, has dominated Gasc purchases so far this season – accounting for 3.6m tonnes of the 5.1m tonnes purchased – the rise in the rouble, up more than 5% this year against the dollar, has undermined its competitiveness
  • Egyptian buying sends wheat futures jumping
    A massive Egyptian wheat purchase late in the previous session helped wheat futures surge, while corn and what continue to gain on biofuel speculations. Gasc, the state grain buyer for the worlds’ top wheat importer, booked 535,000 tonne of wheat for import, its largest single purchase in over three years. The big wheat buying, at a time when Egypt is usually slowing purchases ahead of its domestic harvest, was seen as a bullish sign. Richard Feltes said the big Egyptian purchases “may reduce Russia’s ability to aggressive offer additional March wheat cargoes”. May Chicago wheat futures settled up 3.2%, at $4.57 ¾ a bushel.

Summary:

Despite the White House denying reports that it is working on changes to the E-15 Fuel Partial Waivers exuberance in the markets continue to abound following yesterday’s wild ride. Corn and Soybean markets are still chewing over the possibility of a shift in the US biofuel policy, although hopes are now more focused on potential benefits to demand for domestically produced Soy-oil, than for Corn. The gains in Wheat are coming from overseas demand. Recent purchase on the part of Egypt has been lending great support. The volume was light yesterday but that was not the case today. Both May Corn and July Wheat worked their way up to resistance with May Soybean putting up big gains of its own and could very well reach resistance by over the next two days.

May Corn rose 8.25 today. May Beans was up 16.26 and July Wheat added 12.75. We still maintain that rallies in Beans are great opportunities to price inventory. Trailing behind the market with stop would be prudent.