Headlines:

  • Egypt pays premium for wheat, amid talk of tenders ‘turning into a circus’
    Egypt, the world’s top wheat importer, suffered a double mark-up on its latest wheat tender as it paid a premium for uncertainty over its customs policy, besides higher shipping costs, which are soaring worldwide. GASC, the Egyptian grain authority, bought 175,000 tonnes of wheat from Russia on Tuesday, taking the total it has bought at tender for delivery in 2017-18 above 3.0m tonnes, with the season less than three months old. However, the price paid for the latest order, at an average of nearly $212 a metric ton including freight, was markedly above the little-over $201 a metric ton GASC paid in its last purchase, in late August. The extent of the increase, at 5.2%, was markedly above the extent that prices have recovered in futures markets, with Chicago prices up 1.6%, and Paris values up 2.6% in dollar terms over the same period. In cash markets, wheat delivered to Rouen has appreciated by 2.0% over the same period in dollar terms, on Agritel data, to reach the equivalent of $183 a tonnes, while Russian prices of 12.5% wheat for export on an FOB basis are up about 1.6% to some $185 a metric ton, on SovEcon estimates.
  • World cotton stocks hopes face ‘large cut’, after crop downgrades
    A hefty Washington estimate for world cotton stocks, which fueled a slump in prices last week, looks like being undermined by weaker prospects for Australian exports, besides large hurricane losses to the US’s own crop. The US Department of Agriculture surprised investors last week by raising by 2.46m bales to 92.5m bales its forecast for world cotton inventories at the close of 2017-18 – an upgrade based on higher production forecasts for countries including Australia and, in particular, the US itself. The data spurred a limit-down close to New York cotton futures on the day. However, it now appeared that there had been significant damage to the US crop from the recent hurricanes, Harvey and Irma, and which the USDA has not included in its domestic production forecasts.

 

Summary:

The grain markets were pretty low for most of the day but managed to trim their losses by day’s end. Corn finished 2 about cents shy of the day’s low and had the weakest finish of the trio. December Corn posted its lowest close since August 29th. Soybean and Wheat were stronger in their action. November Beans rallied 8.25 cents off of its intraday low to settle at 966.75 and only gave up 1 cent. It finished below its opening price but its closing price was above the midpoint of the day’s trading range. December Wheat finished a tick in the money. It rallied 8 cents off of its intraday low. Trading was mixed today and we anticipate that ongoing harvest progress and yield projections will become more of an influence on the price action in the coming days and weeks. There were no Soybean export announcements today and that too may have weighed on the markets as well. The USDA does not make announcement everyday but perhaps the trade was starting to expect them regularly.