AWB market update

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Wheat futures traded with mixed results in the US overnight, with Kansas posting minor gains and Chicago minor losses.

Despite talk of an Egyptian tender overnight, it is thought that US wheat is still overpriced, and the tender was eventually secured by Romania, Russia and the Ukraine.

Elsewhere, a large international trading house has reported that the EU crop may be looking bigger than previously thought, making it a strong competitor for Black Sea region crop. It was also reported by the USDA that 119,000 tonnes had been sold by private exporters.

Chicago wheat for Sept 2013 is 4¼ cents lower at 646½ US cents a bushel.

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Corn futures were under considerable pressure overnight, but on strong domestic demand were well in the black before the closing bell.

Whilst the higher temperatures during the crucial pollination period were seen as favourable to the corn outlook, currently warm and dry conditions continue to keep speculation in the market, with estimates for yield varying widely. Elsewhere, ethanol production was pegged at 820,000 barrels per day on average, which is 2.8% lower than last week but up 0.12% from this time last year.

Chicago corn for Sept 2013 is 4½ cents higher at 504¼ US cents a bushel.

Canola closed slightly lower in Winnipeg overnight, after what was a very mixed session of trading. After the strong gains in value seen earlier in the week there was a distinct increase in farmer selling noted, with profit-taking also contributing to the bearish atmosphere.

Further to these short term factors, however, continues the sentiment in the market that this season's canola crop will be of a record size. Limiting losses was spill-over support from CBOT soybeans, which were up on weather concerns.

Winnipeg Canola for Nov 2013 is $2.30 lower at $527.40 Canadian dollars per tonne.

The Australian dollar is currently trading at 0.8941 USD.

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