LAST WEEK MARKET COMMENT

Outlook for better weather in August with more chances at Midwestern, heralded by various weather models, is leading the US market to pull back despite the current dry conditions.?

Corn dropped more than 3%.

Most wheat contracts losing 2%.

Soybeans down nearly 1.25% by the close.

On macro markets, oil prices edged higher on Friday and for the week after a strong recovery from Monday's steep slide, underpinned by expectations that supply will remain tight through the year.

In fact, Brent crude ended the session up 41 cents, or 0.4%, at $74.20 a barrel after jumping 2.2% on Thursday.?

U.S. West Texas Intermediate (WTI) crude settled up 26 cents, or 0.2%, at $72.17, after gaining 2.3% on Thursday.

On Wall St., the Dow moved 238 points higher to close at 35,061, anchored by strong performances in the tech sector.?

US Secretary of the Treasury Janet Yellen called on the government to, yet again, raise the debt ceiling.?

The previous suspension of the ceiling is due to expire on 2 August 2021.??

Most expect that the government will get something done this week.

Coming back on grains market,?a new US export sales flash had 100,000t new crop beans sold to Mexico last Friday.

Meantime, Corn Belt weather maps are still bringing some light moisture across most of the area this week and into early next week, but models have pulled back on rain forecast for Iowa/Missouri.

Temperatures still forecast to be warm in the western Corn Belt but cooler to the east.

The forecasts obviously remain to be confirmed, but lead some operators to close their positions or to start profit-taking operations.?

Since the session sharply up last Monday, prices have gradually declined during the week to ultimately in corn, soybeans and wheat mark Friday a decline over the past week.

The spring wheat crop tour will start on Monday in Fargo, North Dakota and head westwards into Montana.??

Some of the recent private trips around have suggested higher production than the last USDA estimate, so we’ll see how the tour does their magic.??

Insurance adjusters are also appraising crops at the same time.

Drought monitor figures continue to show the stress across spring wheat areas, not that it matters for most with the crop already finishing filling and harvest in full swing.?

Droughty conditions are also expanding in parts of Iowa and Minnesota.

In this context, corn basis bids were mixed at two Midwestern ethanol plants and firmed 4 to 10 cents higher at two interior river terminals while holding steady elsewhere across the central U.S. last Friday.

Soybean basis bids sank 5 to 10 cents lower across five Midwestern processors while firming 5 cents higher at an Illinois river terminal.?

Other locations across the central U.S. held steady.

On European market, harvest is partially over in the earliest areas of Europe and it is only just beginning in the later areas.?

The return of the rain has once again stopped the harvesting sites in France.?

More generally, the whole of north-western Europe will remain penalized by the absence of a high pressure system over the next two weeks.

This chaotic progress of the harvest is fueling concerns and provides support for Euronext wheat prices, which rebounded in the support zone of € 209/210 / t in September 2021.?

The increase is however limited by the Ukrainian harvest pressure and by the forecast some beneficial rains on the Corn Belt.

In oilseeds, it was the very firmness of the palm that provided the most support at the end of last week, enough to bring rapeseed above € 530 / t on Euronext despite reports of better than expected yields in France.

According to the latest FranceAgriMer's report, as of July 19, the condition of the crops noted in good to excellent conditions is:

Common wheat 75% - 1 point compared to the previous week;

Winter barley 74% +1 point compared to the previous week;

Spring barley 81% -2 points compared to the previous week;

Durum wheat 66% unchanged;

Corn 90% +1 point compared to the previous week and +10 points compared to last year.

From Black Sea basin, weather maps are holding dry across most of Ukraine and central Russia – good for wheat harvest but some had hoped for a little more moisture for corn areas.

Russian harvest was reported on Friday at 8.9 million ha of wheat, with another large step up expected after this weekend.

The latest figures from the Ukrainian Ministry of Agriculture released on Friday highlight an increase in volumes exported in July compared to last year.?

The most important exported volumes concern maize with 824,000 t. In barley, activity is also starting at a good pace with 426,000 tonnes loaded. In soft wheat, 399,000 t have already been sold from the various export points.

In terms of harvests, Ukrainian producers have now exceeded 20% of the areas harvested. In total, the grain volumes currently collected stand at 14.1 Mt over 3.4 million hectares.

From Australia, fairly quiet end to the week locally, with a few domestic users looking for parcels but limited volume.

Nice light rain fell right across the east coast over the weekend, and weather maps still are very solid for WA this week, 15-25+ mm forecast in the Wheatbelt.

Congratulations to all those competing in the Olympics – and especially the Women’s freestyle relay team on their gold.

We wish you a good day.