Wheat up sharply on supply tightness
December 2, 2021 By John Perkins Filed Under: Closing Futures / Livestock Briefs, Crops Markets, Market News
Soybeans were solidly higher on fund and technical buying, along with a generally bullish move in the broader market. China and unknown destinations bought 2021/22 U.S. beans Thursday morning, 130,000 and 164,100 tons, respectively, and while weekly sales were lower, they were still over a million tons. Last week’s biggest buyer was China, but Beijing is still leaning on Brazil for large parts of its purchase needs due to their price advantage starting this winter. The USDA’s next set of supply and demand estimates is out December 9th. The trade is monitoring development conditions in Argentina and Brazil ahead of the full emergence of the La Nina pattern. Soybean meal was mostly higher and bean oil was up on the bullish tone in the soy complex. Soybean meal and oil export sales were up on the week.Corn was modestly higher on fund and technical buying, in addition to outside market influence and the strength in wheat. Corn is also watching South America, with good near-term rain in the forecast for central Brazil against lighter amounts in southern areas and Argentina. That’s in-line with the emerging La Nina pattern and would likely trim yields, at least to some extent. Weekly U.S. corn export sales topped a million tons, mainly to Mexico and Canada. Nearly a quarter into the marketing year, 2021/22 sales remain behind 2020/21. There’s been more talk of China buying corn from Ukraine instead of the U.S. The big supportive factors for corn continue to be livestock feed and ethanol demand. Ethanol futures were unchanged.The wheat complex was sharply higher on fund and technical buying. Paris milling wheat was higher ahead of the U.S. session as global supplies remain at more than 10-year lows. Additionally, the trade is monitoring increased political tensions between Russia and Ukraine, which could disrupt global trade. At roughly the halfway point of the 2021/22 marketing year, last week’s wheat sales were a marketing year low. The leading buyers were Colombia and Mexico. Weather is also a concern in some areas. Drought is continuing to expand in parts of the southern U.S. Plains and portions of the eastern Midwest are excessively wet. Globally, heavy rainfall has disrupted harvest activity in eastern and southern Australia, lowering crop quality. The Canadian National Railway Company says it is working to re-open a key track washed out in a flood by this weekend.
Your email address will not be published.
Subscribe for our newsletter today and receive relevant news straight to your inbox!