Grain prices have again eased overnight as markets shrugged
off the implications to Russia's ban on ag imports from many Western countries,
instead focusing on the further weakness in broader financial markets.
Equities markets overnight slipped deeper into the red as
US President Barack Obama authorized air strikes on targets in Iraq, negating the
impact of stronger trade figures from China.
At the time of writing the Nikkei 225 index stood down 3% while the Hang
Seng was off 0.2%.
China reported a trade surplus of $47.3bn, above the
$26bn forecast as exports jumped 14.5% from the previous month, reflecting the
stronger economic figures from the country recently amid signs the
mini-stimulus measures announced in April are helping quicken growth back to
the official 2014 target of 7.5%.
Chicago wheat futures for September delivery, stood down
0.1% overnight trade at $5.60 ¾ per bushel compared with Thursdays closing
level of $5.61 ½ a bushel.
Reports the current wheat crop in Australia is set for an
early harvest has done little to improve to bearish outlook at present, adding
to strong supplies globally this year.
The National Australia Bank's latest
Commodities Wrap forecast global wheat production this year to total 705.2m tonnes, the second highest on record.
"Crop conditions are
exceeding expectations in several of the key wheat states," stated Gail Martell
of Martell Crop Projections.
conditions have seen expectations for Australia's wheat harvest improve from
previous forecasts. In June Australia's Department
of Agriculture ABARES department forecast the wheat harvest would be some 9% down
from the previous year.
"Wheat potential is
rather favorable in Western Australia," noted stated Gail Martell, although
cautioned, "drought in New South Wales would weigh on the wheat outlook."
"ideal weather" overhangs corn
Corn has added to the
weaker outlook for wheat, with Chicago futures for December delivery down 0.2% in
overnight trade, at $3.70 ½ a bushel.
Wheat is "weak on its
own merits and is tethered to the very weak corn," said Sterling Smith of
"Corn prices have been
under significant pressure in the last three months, as ideal weather fuelled
predictions of a record yield and possibly a record crop," noted John Clemmow
Brazil's Conab crop
bureau yesterday raised its estimate for the 2013-14 corn harvest(s) by 355,000 tonnes to
In addition the latest figures
showed US corn export sales were soft at 758,000 tonnes for 2014-15, below
hopes for at least 800,000 tonnes.
Soybean important weather "still ahead"
Soybeans have seen
similar price sentiment overnight with Chicago futures for November off 0.2% from Thursdays closing
level at $10.76 ¼ a bushel.
By contrast soybean
futures for January delivery edged higher on the DaLian Commodity Exchange
Friday, to stand up 0.4% at RMB 4,547 a tonne near the close.
The outlook for
soybeans remains somewhat mixed in the near term, particularly as "The most
important weather for the soybean crop is still ahead of us," noted Citigroup's
Mr Smith believes, "August
soybeans will be able to hold a premium above the new crop," but noted, "The
larger than expected stocks situation combined with available imports should
keep bullish ideas tethered to the weather".
Citigroup forecast November
futures to hold "a range of $10.45 to $11.45".