AWB market update

Wheat traded lower overnight, following the pace set by both corn and soybean markets in Chicago.

It was reported that the North American harvest has proceeded very well, with solid yields noted. Futures in Paris were also lower on stronger production expectations, though market expectations proved are that French grain will be outcompeted for an Egyptian tender by the Black Sea region. World supplies have retained a bearish outlook, though the suspicion is that ABARES will be revising down estimates on the Australian 13/14 crop after dry conditions.

Chicago wheat for Sept 2013 is 2¼ cents lower at 634¼ US cents a bushel.

Corn was lower overnight as well, as the harvest continues to make progress, though some support was found late in the session. Yields have been coming in ahead of expectation in some regions, leading to the bearish outlook.

Whilst the spectrum of expectations from private firms remain broad, the USDA will be releasing its report on the 12th of September, which will have strong implications for the market direction from that point. What is agreed is the expectation for some wide-felt effect as a result of the warm, dry conditions of last week.

Chicago corn for Sept 2013 is 4 cents lower at 494 US cents a bushel.

Canola took some further hits overnight, as the US soybean complex lost a lot of ground, which had negative spill-over consequences for other oilseed markets around the world. Forecasts for some much need moisture in the US led to the more bearish outlook for soybeans, and without this support canola took losses, as the upcoming harvest continues to look positive. Furthermore, a stronger Canadian dollar added to the negative trend.

Winnipeg Canola for Nov 2013 is $5.20 lower at $517 Canadian dollars per tonne.

The Australian dollar is currently trading at 0.9166 USD.