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AWB market update

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Wheat moved higher during the overnight session in Chicago, however during the day's trading this positive momentum ran out as corn moved lower, and wheat finished the day in the red.

At this point the ending stocks in Kansas City and Chicago remain low, with expectations being that some rationing of feed wheat will be necessary going forward. Also playing an important role will be the strength of demand from South America, though for the time being wheat looks to continue following the trends set by corn.

Chicago wheat for Sept 2013 is 6¾ cents lower at 636 ½ US cents a bushel.

Corn markets, much as with wheat, rallied powerfully during overnight trading in Chicago before losing a lot of steam and closing largely down. With a market expectation for a decline in "excellent" crop conditions of 2-3% (it was revealed to be around 3% after trading had concluded), and strong commercial buying, some upside was seen for September contracts as the exception. As harvest continues in the US, further pressure is expected to be applied to the corn complex as new supplies hit the market.

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Chicago corn for Sept 2013 is 3 cents higher at 498 US cents a bushel.

Canola had a very mixed day of trading in Winnipeg, eventually ending close to unchanged. Early action saw a strong wave of fund-related buying, however this trend lost traction as continued expectations for a strong crop weighed against it. Whilst US soybeans saw some upside which would usually flow on to canola, the excellent growing conditions in Canada increasingly point toward a solid crop, limiting possible gains.

Winnipeg Canola for Nov 2013 is $0.10 lower at $522.20 Canadian dollars per tonne.

The Australian dollar is currently trading at 0.9060 USD.

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