THE rain dances have finally paid off with some very timely and pleasing falls over the past week.
As the canola window starts to close, the Central West has seen up to 80 millimetres of rain in patches, with the majority receiving anywhere from 30mm to 50mm.
The satisfying falls have thrown a lifeline to the large percentage of canola that has been sown dry across NSW this year. The is balance expected to be planted this week, with growers fitting their wheat and barley planting around canola.
The delayed autumn break had started to create some nervous market participants with liquidity in both old and new crop markets drying up, as well as grower appetite to part with on-farm stocks with the move into the sowing window not high on the agenda.
Demand remains very lacklustre with consumer appetite subdued as they play their cards close to their chest.
With Australian values still sitting above export parity and the carryout into 2017 higher than we have had for a few years now, the lack of export demand is hampering the ability of the trade to actively chase grain.
The old saying of ‘what goes up must come down’ is probably the best way to sum up the impressive run in CBOT futures had a week ago when the nearby CBOT wheat contract pushed through the $US5 a bushel barrier after being as low as $US4.46/bu in the middle of April.
The managed money got weak at the knees when the sound of dryness in Brazil and a wet corn and bean harvest in Argentina hit the headlines.
The massive sold position by funds in the commodity markets has been well
reported for some time but there had been little market intel to give anyone confidence to take the other side against them.
With reasonable volatility over the past week or two, the commitment of traders report out this week has seen them cut their CBOT wheat interest by nearly 20,000 contracts or 2.7mmt and add to their length in corn and beans by approximately 150,000 contracts.
