Brought to you by AG Concepts

Thursday, November 06, 2014

Grain markets bounce from late September doldrums – October percentiles

By Augusto Semmelroth  |  Source: ASX, CME, ICE

International and domestic grain and oilseed markets have recovered 10-15% after hitting 5-year lows in late September. Despite the recent rebound, global spot prices remain quite depressed at their 20-30th percentiles. Domestically, the situation is clearly better as a result of a strong basis, with ASX milling wheat and feed barley now back at their 66th and 85th percentiles, respectively. In WA, ASX milling wheat is at its 53th percentile.

Key points:

  • After a strong sell off between May and mid-September, international and domestic grain markets recovered up to 15% in October.
  • Yet, with international grain and oilseeds stocks at very comfortable levels, CME corn, wheat and soybeans remain quite depressed in percentile terms at their respective 20-30th levels.
  • Canola markets are also depressed despite the smaller Canadian and European crop this year as abundant soybean supplies weight down on the whole oilseed market. ICE Canola Jan-15 contracts remain at their 30th percentile.
  • Domestic wheat markets continue to track at a solid premium to international prices with ASX milling wheat Jan-15 around A$70 above CME prices at $292/t by the end of October. This puts wheat at the 66th percentile level this harvest.
  • ASX feed barley Jan-15 is by far the best performing grain across the board finishing October at $253/t, or its 85th percentile. Since then, prices continued to climb higher and were quoted at $261.6/t on November 4th.
  • In WA, ASX milling wheat Jan-15 continues to trade at a small discount to NSW prices, now at $285/t (53rd percentile)
  • Looking ahead to the 2015/16 crop, international prices are faring slightly better than the current spot prices with CME corn and wheat Dec-15 at their 33rd percentile level. Yet, these prices are still quite depressed in comparison to the levels seen since 2009.
  • Domestic 2015/16 crop prices, on the other hand, remain at a considerable premium to global prices with ASX milling wheat at 61st and 53rd percentile in NSW and WA, respectively.
  • ASX feed barley, remains at around its 90th percentile for 2015/16 while CME corn (global feed grain price benchmark) is still at the 33rd percentile. 

Read more about how to interpret percentiles

2014-11-06 Grain Percentiles FIG 1 Lge

Mecardo information is provided to assist in your marketing decisions. It contains a range of data and views on the current market. It is not intended to constitute advice for a specific purpose. Before taking any action in relation to information contained within this report, you should seek advice from a qualified professional. The information is obtained from a variety of sources and neither Mecardo nor Ag Concepts Advisory will be held liable for any loss or damage whatsoever that may arise from the use of information or for any error or mis-statement contained in this report. 

x

Sign up for a FREE BASIC SUBSCRIPTION now to read this article.

Mecardo will send you its latest market analysis outlook delivered to your Inbox as it's published.  You will also receive one month Premium access for free.

You tell us what information you want to hear about, so you'll only be alerted to information that is relevant to you.

Learn more about Mecardo Sign Up Now!