|Highlights of this week
It has been another bullish week for global wheat markets. The bullish market move follows the announcement of Russian government wheat export intervention, strong importer demand from Algeria and Egypt, in addition to the FAO stating they expect a decline in global wheat production and an increase in demand in 2021/22. Meanwhile Eastern Australia is experiencing extremely wet weather, hampering harvest progress and quality.
The situation remains fragile in North Africa, with food security crucial, as highlighted in the latest policy brief from the Middle East Institute – Read here
This week we have seen managed money substantially increase their short soybean position’s, rising from 47.99K positions the week prior to 69.8K. Although this represents the highest number of short soybean contracts held by managed money since June 2020, fund involvement remains supportive with a net long position overall. Soybeans have found strong support this week and have been buoyed by recent export figures to China, with 1,657,200 metric tons of US soybeans heading their way. For in depth analysis of soybeans and the wider oilseed market please see our latest Weekly oilseed outlook.
For corn, US Ethanol production has shown no signs of slowing down and continues to support corn and the wider grain market, with production staying above the 1-million-barrel mark for the 6th consecutive week. Stocks of ethanol were down week-on-week. Adding further bullish market sentiment for corn has been the continued climb in Chinese domestic corn markets. To understand how this will affect global grain prices see our latest Weekly grain outlook.
Our weekly weather alerts continue to monitor evolving conditions in South America as covered in both weekly reports.