Written Commentary
ADM Appoints Monish Patolawala as EVP and CFO
July 10, 2024
*Close price is the last traded price at time of report
Source: FutureSource
Bullish sentiment returned across the board on US ag markets. Wheat is supported, Chicago Dec-21 Dec-21 was up 11 cents and Kansas Dec-21 up 9 cents at the time of writing. Minneapolis Dec-21 continues to reach new contract highs after last yesterday’s close, hitting a trading high of 994 and up 15 cents at time of writing. Japan’s Ministry of Ag’s tender of 81,318t for Canadian and US wheat is closing tomorrow. Rabobank has forecast the Aussie wheat harvest to be 31.9Mmt as the combines are rolling in Queensland, down 4% on 2020 but still 25% above the five year average. Aussie canola production is expected to hit a new record high of 5.2Mmt, up 14% on 2020.
Matif wheat followed Chicago, continuing the bullish sentiment with higher prices. As mentioned beforehand, EU exports at current pace is unsustainable will need to price themselves out in order to curb the movement. Baltic milling wheat premiums have surpassed German levels, despite the freight disadvantage. Questions remain on the capacity and volume of milling wheat France can sell on the world markets, as do the volumes sold to China. Russian nearby demand continues with a strong FOB line-up, even with the prevailing tax changes and hikes, traders are trying to outload as quickly as possible. Aren’t they glad they invested into upgrading port infrastructure at Novorossiysk and on the Azov. Russian trader Demetra, Russia’s third largest wheat exporter, has confirmed the supply of 60kt of wheat to Algeria, the first major supply from Russia to Algeria since 2016. Inroads are starting to happen folks. French quality issues has pushed Algeria to search elsewhere and since last October, Algeria has relaxed its terms regarding bug damage. Oh hello Black Sea wheat. Matif Dec-21 settled up €4.50 on yesterday at €278.25/t and May-22 settled up €2.75 on yesterday at €267.25/t.
London wheat gained support from Paris. Nov-21 settled up £0.75 on yesterday at £207.25/t and May-22 settled up £2.25 on yesterday at £217.25/t. Physical prices remain strong with October East Anglia delivered at £205/t and Nov East Anglia delivered at £207/t.
Rapeseed continues its blitzkrieg climb to the sky. Matif Nov-21 hit a trading high today of €700/t, a true Chernobyl moment, before settling up €10.00 on yesterday at €698.25/t. May-22 settled up €11.75 on yesterday at €664/t. Canadian canola was also trading at contract high levels following yesterday’s close, Nov-21 trading up 6 cents. Chicago soybeans were steaming ahead with Nov-21 up 14 cents at time of writing and May-22 up 15 cents at time of writing.
Contact the ADMISI Grains and Oilseeds Derivatives Brokerage team
Hanne Bell, Ryan Easterbrook, Dominic Enston, Aaron Stockley-Isted
Phone: +44 (0)20 7716 8477 or +44 (0)20 7716 8140 Email: intl.grains@admisi.com
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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.
© 2024 ADM Investor Services International Limited.
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