Grains Futures Extend losses, U.S-China Trade disputes in weighing on prices.June 26, 2018
Grains’ futures extended on the path they’ve been on in recent weeks, trending lower. Corn and Soybean futures are being pressured by the US-China trade rift. Meanwhile, Wheat prices are feeling the burden of a rapidly progressing harvest.
In the weather space, most of the central U.S. could see some seasonally cooler weather for the next several days. However, The latest five-day cumulative precipitation maps from NOAA show a large swath of the Midwest, from Nebraska through Ohio.
Oil prices advanced during the Asian session on Tuesday, bolstered by Canadian production losses and the growing uncertainty regarding Libyan exports. However, it lost again later in the European session after finding pressure in the form of climbing OPEC supply and intensifying trade conflicts between the United States and other major economies.
U.S. West Texas Intermediate Crude Oil August futures were nearly unchanged at 68.21 USD per barrel at 11:00 GMT. However, Brent Oil August futures added 0.3 percent to trade at 75.08 USD per at 11:00 GMT.
CBOT July Wheat futures extended losses on Tuesday, weighed down by progress in U.S wheat harvest, and U.S trade disputes. CBOT July Wheat prices dropped 2.21 percent on Monday to trade at 4.76-3/4 per bushel at the close. Early Tuesday, the contract continued its decline to loss 0.67 percent to trade 4.76 USD per bushel 11:00 GMT.
In the Fundamental space, USDA’s export inspections showed that wheat exports reached 13.0 million bushels last week, slightly lower compared to prior week’s total of 13.8 million bushels. Moreover, exports fell short of trade estimates that ranged between 11 million and 18 million bushels.
Ahead of Monday afternoon’s USDA Crop Progress reports, analysts expect that 78% of the U.S. spring wheat crop is in good-to-excellent condition, unchanged from the previous week’s conditions. Analysts also estimate that around 40 percent of the 2017 /18 U.S. winter wheat harvests are now complete, up from 27% a week ago.
In the export space, Syria could import as much as 55 million bushels of wheat this year, although the country’s internal trade minister recently indicated it currently has strategic reserves sufficient for the next eight months.
Iran released an international tender for the purchase of 1.8 million bushels of wheat, sourced from the U.S, Canada or Australia, with a deadline for bids by July 2.
Ukraine’s winter grains harvest has reached 62.5 million bushels so far, including 20.3 million bushels of wheat, with average yields totaling 44.3 BPA.
Preliminary volume estimates were for 132,010 CBOT contracts, up slightly from Friday’s final count of 129,454.
CBOT July Corn futures dropped by 2.38 percent on Monday to trade at 3.50-1/2 at the close. Early Tuesday, CBOT July Corn prices edged down by 0.29 percent to trade at 3.50 USD per bushel at 11:00 GMT.
USDA’s export inspection report showed that Corn export reached 59.5 million bushels last week – beating trade estimates that that ranged between 43 million and 66 million bushels,
Ahead of Monday afternoon’s USDA Crop Progress reports, analysts expect the agency to report that 77% of this year’s U.S. corn crop is in good-to-excellent condition, slipping from 78% a week ago.
Meanwhile, in Brazil, Agroconsult estimates that corn harvest this year will be around 2.165 billion bushels, compared to prior estimates of 2.244 billion bushels, stating the prolonged drought conditions in some area.
Preliminary volume estimates were for 407,512 contracts, up moderately from Friday’s final count of 349,216.
CBOT July Soybean futures Tumbled by 2.56 percent on Monday to trade at 8.74-1/4 at the close, as the U.S –China trade disputes pressured Soybean prices further in the negative territory.
Early Tuesday, CBOT July Soybean future were steady at 8.75- 3/4 USD per bushel at 11:00 GMT.
Soybean export inspections tallied 18.9 million bushels last week, slightly below last week’s total of 30.1 million bushels, and landing on the low end of trade estimates, which ranged between 14 million and 29 million bushels.
Ahead of Monday afternoon’s USDA Crop Progress reports, analysts expect the agency to report that 73% of the U.S. soybean crop is in good-to-excellent condition, unchanged from the prior week.
In exports, Private exporters reported a sale 6.8 million bushels of soybeans for delivery to unknown destinations during the 2017/18 marketing year, which began September 1, according to USDA.
Preliminary volume estimates were for 223,003 contracts, dropping moderately from Friday’s final count of 309,410.