AWB market update
Wheat futures made a spirited effort to follow up the gains of yesterday, but encountering stiff resistance to selling, particularly at the tail end of the day, to close lower.
The early strength was attributed to an increase in interest for the wheat/corn spreads. Around the world, France is looking bullish, with futures in Paris lower on news of a larger crop, despite doubts over quality.
Egypt continues to remain absent from the market, as does China, whilst Syria cancelled a tender potentially due to unrest in the region. Also Brazil, Argentina and Australia were all noted as countries expected rainfall which would benefit crops in coming days.
Chicago wheat for Sept 2013 is 7¼ cents lower at 634¼ US cents a bushel.
Corn had a slower day after the dramatic gains of the previous session, easing off a little on news of favourable crop conditions in Ohio and South Dakota.
Despite this, it is still clear, according to a crop tour moving through the Corn Belt, that many areas remain in dire need of rainfall in the near future.
Temperatures are predicted to rise higher by the weekend, however there is a chance for showers in some states next week. The market will be closely watching the next USDA report for any revisions to current yield expectations.
Chicago corn for Sept 2013 is 9½ cents lower at 483¾ US cents a bushel.
Canola, much in the vein of corn and wheat, dropped back from the gains of yesterday's session, citing speculative profit-taking as being the primary factor at play.
There was a sentiment in the market that values were due for correction, and it was also noted that some were waiting for a jump in prices like this as a chance to sell ahead of harvest pressure from what is predicted to be a formidable Canadian crop.
At present Statistics Canada is estimating the crop to come in a little over 15 million tonnes, well ahead of 13.3 million tonnes in 2012.
Winnipeg Canola for Nov 2013 is $9.70 lower at $508.10 Canadian dollars per tonne.
The Australian dollar is currently trading at 0.9069 USD.
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