Grain market looks to WASDE for direction Grain market looks to WASDE for direction Grain market looks to WASDE for direction

Grain market looks to WASDE for direction

Ole Hansen

Head of Commodity Strategy

Summary:  Grain and soybeans traders await the release of the monthly supply and demand report from the US government at 1600 GMT. Last months report wrong footed the market and helped send corn down by more than 10% and wheat by 5%.


Grain and soybeans traders have spent the past week scaling back short positions ahead of today’s 1600 GMT release of the monthly supply and demand report from the US Department of Agriculture.

Last month’s surprisingly upbeat report helped send corn down by more than 10% after the government report penciled ending stocks close to 40% higher than trade estimates. Wheat dropped by 5% while soybeans was down by a mere 1.5%.

With the US harvest about to get under way this will be the final report purely based on estimates instead of hard data. From September 16 the USDA will release a weekly harvest progress report for wheat while corn and soybeans will join the following week.

From July up until September 3 hedge funds had according to the weekly Commitments of Traders report reversed a 200k lots long position to a 119k lots short. The net position in wheat meanwhile has stayed close to neutral while speculators amid lack of Chinese buying have held a net-short in soybeans since February.

Corn for December delivery reached life-of-contract low last week at $3.52/bu before the mentioned short-covering helped lift the price to the current $3.61/bu. At this stage it will take a break initially above $3.64/bu but more importantly $3.80/bu before talks of a meaningful recovery can begin. A late-summer heatwave has raised hopes that late-planted US crops could accelerate towards maturity thereby reducing the risk of a late harvest causing frost damage.

Source: Saxo Bank


Boulevard Plaza, Tower 1, 30th floor, office 3002
Downtown, P.O. Box 33641 Dubai, UAE

Contact Saxo

Select region

UAE
UAE

Trade responsibly
All trading carries risk. Read more. To help you understand the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. Read more

Saxo Bank A/S is licensed by the Danish Financial Supervisory Authority and operates in the UAE under a representative office license issued by the Central bank of the UAE.

The content and material made available on this website and the linked sites are provided by Saxo Bank A/S. It is the sole responsibility of the recipient to ascertain the terms of and comply with any local laws or regulation to which they are subject.

The UAE Representative Office of Saxo Bank A/S markets the Saxo Bank A/S trading platform and the products offered by Saxo Bank A/S.