ADMISI London Wheat Report for 23 August

London Wheat Report

Source: FutureSource 

The bulls are on the run this Tuesday. US dollar set new highs overnight, all eyes are on the Jackson Hole meeting. Oil markets are rallying on data that Saudi are seeking to lower production levels, record low US oil reserves and a miscellaneous issue with the Kazakh oil transit pipeline running through Russia which has had to undergo key maintenance resulting in a 70% decrease in oil transit vols ……… what a surprise and who could possibly be behind this?! Tomorrow is the 6 month anniversary of the war in Ukraine which also coincides with Ukraine’s 31st independence day from the Soviet Union, numerous speculation in the news that the Kremlin’s top philanthropist, Vlad himself, may be sending a few undesirable things their way.

Supportive crop conditions data from the USDA and initial start to the Pro Farmer crop tour have helped all ag markets higher. USDA ranked Corn 55% G/E vs 57% last week, and 60% a year ago and Soybeans 57% G/E vs 58% last week, and 56% a year ago. South Dakota corn yields were projected at 118.45 bushels per acre (bpa), the Pro Farmer Midwest Crop Tour said on Monday, the worst on the tour since 2012 and well below the 2021 crop tour average of 151.45 bpa and the three-year crop tour average of 161.59 bpa. Chicago Sep-22 corn was trading up 28 cents at time of writing. Matif Nov-22 corn settled up €13.25 on yesterday at €323.75/t.

24% of the U.S. soybean crop remained in an area experiencing drought as of Aug. 16, mostly west of the Mississippi River, according to the USDA. 110kt of new crop beans was sold to China offering additional support. Matif Nov-22 rapeseed had a mixed day with a €26.50 trading range today, settling up €12.75 on yesterday at €635.50/t. Germany’s 2022 winter rapeseed crop is expected to rise to about 4 million tonnes from 3.4 million tonnes last year, helped by a 9% increase in planted area.

Wheat markets also saw a rally, supported by the uplift in corn combined with the Ukraine uncertainties and news that GASC had re-joined the party after saying how much supply they had (shock). GASC confirmed that they had purchased 240kt via a direct purchase source from Russia with the potential for further purchases as talks were still ongoing. More market chatter of China buying more French wheat also offering Matif support. Germany’s 2022 winter wheat crop will increase to about 21.8 million tonnes from 21.0 million tonnes last year, the DBV association of German farmers said on Tuesday. Matif Dec-22 wheat settled up €9.25 on yesterday at €326/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.

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