In a day not noted, generally, for large trading volumes, the pattern of early trading was still readable at the close.
Minneapolis spring wheat remained a leader, adding 0.8% to $5.24 ¼ a bushel for December delivery, actually in pretty reasonable volumes, as worries over the North American harvest mounted.
This when funds have a large net short in the grain, which is looking less and less lucrative, with the lot now above its 50-day moving average, meaning most people who have traded short in the last two months and more will be out of pocket.
‘Diverted into the feed channel’
“Canadian wheat harvest continues to drag with half a crop yet to be taken,” said Benson Quinn Commodities.
“Quality problem will mean a large percentage will end up in feed channels,” the broker added, with the wetness slowing harvesting undermining crop specifications.
(In fact, as Agrimoney pointed out 24 hours ago, in Saskatchewan, the top Canadian grain-growing province, spring wheat harvest was just 13% complete as of Monday – down from 50% a year before.)
CHS Hedging said that “US harvest results for spring wheat continue to show extremely poor quality.
“Falling numbers are very low and will have to be diverted into the feed channel.”
‘Quality a concern’
US Wheat Associates in a weekly report said that “the 2019 HRS [hard red spring wheat] harvest made minimal progress due to widespread rainfall across the growing region.
The falling number is actually coming in at 382 seconds, according to US Wheat Associates, which compares with a final number of 414 seconds a year ago.
The North Dakota Wheat Commission said earlier in the week that “with the wet conditions, quality on the remaining crop is a concern, but will be highly dependent on maturity level in the crop”.
“Vitreous kernel content is 66%– an effect of the wet harvest conditions,” and a result well below last year’s of 78-90%, depending on protein level.
A more precipitation is expected for the northern Plains, which Maxar said would “lead to some wetness and disease concerns and stall spring wheat harvesting”.
‘Taken a toll’
In New York, early winner cotton also closed in positive territory, by 0.4% at 60.57 cents a pound, although not quite enough to retake its 50-day moving average.
As Plexus Cotton noted, “the US cotton belt has experienced some unseasonably hot and dry conditions lately, with mixed results for the crop.
“While it has helped to get some fields ready for harvest, it seems to have taken a toll on some late maturing cotton”, and ensures that “the US crop is still a moving target in regards to size and quality.
“This is one of the reasons why we don’t think the trade is going to chase prices too much lower from here.”
Other reasons include, of course, the potential for a China-US trade deal.
Meanwhile, on the negative side, Chicago soyoil, which started soft, ended softer, closing down 1.9% at 29.40 cents a pound for December delivery – falling, just, back below its 200-day moving average.
Overnight, “offshore vegetable oil markets were again weaker in China and Malaysia,” Terry Reilly at Futures International noted, with Brent crude losing most of its early headway too.
Soyoil’s weakness weighed on soybeans themselves, which for November closed 1.2% lower at $8.82 ¾ a bushel.
A lack of further announcements of Chinese purchases also weighed, bolstering impression that the latest 720,000 tonnes of orders were an isolated incident.
‘No weather threat’
Chicago corn for December ended lower too, by 0.5% to $3.70 ¾ a bushel.
Mr Reilly noted a “lack of bullish news and non-threatening US weather”.
Midwest rains over the next two weeks “will further boost soil moisture for late filling of corn and soybeans”, Maxar said.
CHS Hedging said that “there is no weather threat for the US through the end of the month and first week of October”.
Soft red winter theat futures, meanwhile, fell by 0.7% to $4.84 ¼ a bushel in Chicago.