Written Commentary
Source: Future Source
US markets were closed today for Labour day. European wheat futures under pressure, with both Paris and London drifting lower. It was a relatively slow day with the US markets closed and traders awaiting the WASDE crop estimates later this week, due on 10th September. Paris Dec-21 milling wheat settled down €2.25/t on Friday at €244.50/t. Data from clearing house LCH showed storage certificates for 141,000t of wheat had been submitted so far for physical delivery against the September contract. Traders are continuing to assess French wheat quality with French traders now chasing German milling wheat, with some traders offering to pay €10/t over Paris Dec-21 for milling wheat for September delivery (Reuters). After Algeria reportedly eased test weights, traders are watching to see how large volumes of wheat due to be shipped to China would be executed. UK feed wheat futures followed Paris, Nov-21 settling down £2.00/t on Friday at £188.25/t. UK harvest continues to roll with farmers trying to catch up with the dry weather forecast.
Russian wheat exports for August amounted to 5.5Mmt, which is closed to maximum values according to Arkady Zlochevsky, President of the Russian Grain Union. Australian farmers are on course to harvest a near record amount of wheat this season, increasing by 17% to a total of 32.63Mmt during the season ending June 30, 2022 (Reuters). Excellent growing conditions throughout June and July this year, with above average rainfall have substantially supported crop growth.
US weather conditions improved over the last couple of weeks across the primary corn growing regions. CBOT corn Dec-21 fell 30 cents last week due to the elevator complexities caused by Hurricane Idha. The WASDE report will now be a primary watch point for future price direction, especially with previous mixed yield estimates.
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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.
© 2021 ADM Investor Services International Limited.
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