Markets are waking up from the winter
Weather, spring planting plans, trade negotiations, and more are getting headlines after months focused primarily on the U.S. and China trade drama. Look for the U.S. Department of Agriculture reports at the end of the month to shape expectations into the spring. Meanwhile, much of the U.S. is too wet with planting just around the corner.
Wheat prices have continued to move steadily off the lows, making new highs for the month of March. The wheat market has been supported by a huge influx of buying interest after prices fell to a new low early in the month. Additionally, some fears surrounding the quality of the winter crops as well as the ability to plant spring crops are leading to higher markets.
Sales of wheat have slowed out of the Black Sea Region, suggesting that inventories have dwindled after their late-season export push.
Durum prices were unchanged from a week ago. The market simply has not gotten much traction through the winter. The next potential support will come with farmers' planting intentions and the spring weather impact.
The U.S. sold 11 thousand metric tons of durum wheat in this week's export report, primarily selling to Nigeria.
The canola futures market had been trending higher since making new lows in early March. Prices turned lower late in the week however, taking back more than a week of gains.
Pressure for canola is coming from overall weakness in the soybean oil market. Meal and soybean prices have firmed, but oil has been dropping steadily for a few weeks. Additionally demand for canola seed has been weak and logistical problems are keeping transport of seed slow, raising fears of ongoing elevated stock levels.
The antitrust watchdog group in India (Competition Commission of India or "CCI" for short) conducted raids at facilities of three trading groups after an investigation of collusion during a food shortage in 2015 and 2016. The three companies (Glencore, Africa's Export Trading Group, and India's Edelweiss group) are accused of forming a cartel to control imports of pulses into India and sell their supplies at an artificially high price during a time when many in India were struggling to find food. The antitrust officials gathered evidence and questioned company officials during the raids.
Mustard seed markets were modestly higher in the last week. Prices were strengthened on a weaker Canadian dollar. The price of Oriental mustard seed rose 5 percent while brown and yellow varieties climbed just 1 percent.
Coming out of the winter, many crops in the European Union are in good shape. According to the crop monitoring service MARS, only some areas suffered frost damage or have been hit by dryness (primarily in Southern European countries like Spain and Italy). Other than that, most cereal crops are looking good. In some of the dry areas, farmers are electing to replant other crops, including barley.