ADMISI London Wheat Report for 2 September

London Wheat Report

Source: FutureSource 

Not the most exciting of days on the market. US Ag markets firmed up today following yesterday’s losses, buoyed up by a recovery in crude and a weakening USD. US job growth seen as solid in August but labour market is starting to loosen. Brent was trading up 2% on yesterday. Gazprom have announced that Nordstream 1 gas flows are to fire up again as planned on Saturday after a 3 day shutdown. EU agree Russian oil price cap to try and reduce the cash flow to the Kremlin’s coffers. Next week we will see the next Conservative leader and the new PM. Liz Truss remains the bookies favourite  and the pound has been under pressure, trading at two month lows against the Euro and hitting lows against the dollar not seen since March 2020. China’s COVID lockdowns continue.

Chicago wheat was trading up after bargain buying kicked off with short-covering in action following yesterday’s losses. Export activity has reassured market concerns. Russian wheat export tax continues to fall as demand needs to crank up to cover the export volumes. Shipments from Russia in July and August, the first two months of the new season, fell 22% to 6.3 million tons from a year earlier, according to ship line-up data from Logistic OS. Ukraine’s grain exports are down 54.5% year-on-year in the 2022/23 season so far at 4.16 million tonnes according to the Ministry of Ag. First vessel carrying ADM grain since the start of the war has left the ADM export terminal at Odessa. Matif Dec-22 settled down €1.50 on yesterday at €323.75/t.

Corn was firming on spill over strength in financial markets with rising expectations that US harvest will fall below USDA forecasts. Trade sources have said that the rumoured cancellation of Brazilian corn cargoes booked by European importers after much cheaper Ukrainian corn was hitting the market. French farmers have begun harvesting corn 12 days ahead of average. Going to be a dire corn crop in Europe. French corn crop ratings have dropped to 45%, down 2% on last week.

Oilseed complex found support, primarily supported by crude. US beans are still competitive on the global market. USDA soybean crushing is up 9% on the same time YOY. US July soybean crush is pegged at 5.4Mmt, up 4% on last month. Argentinian  sunflower sowing is being hindered by the lack of rainfall in Northern Argentina. Matif rapeseed Nov-22 settled up €7.75 on yesterday at €612.75/t.

Contact the ADMISI Grains and Oilseeds Derivatives Brokerage team

Hanne Bell, Ryan Easterbrook, Dominic Enston and Aaron Stockley-Isted

Phone: +44 (0)20 7716 8477  or  +44 (0)20 7716 8140      Email: intl.grains@admisi.com

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© 2022 ADM Investor Services International Limited

Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.

ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.                  

A subsidiary of Archer Daniels Midland Company.

© 2021 ADM Investor Services International Limited.

Futures and options trading involve significant risk of loss and may not be suitable for everyone.  Therefore, carefully consider whether such trading is suitable for you in light of your financial condition.  The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM.  The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared.  The information provided is designed to assist in your analysis and evaluation of the futures and options markets.  However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.

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