Poultry
xClose

Loading ...
Swine
xClose

Loading ...
Dairy & Ruminant
xClose

Loading ...
Aquaculture
xClose

Loading ...
Feed
xClose

Loading ...
Animal Health
xClose

Loading ...
RSS


October 30, 2008

 

Australia wheat futures up on US dollar

 
 

Australia's most active wheat futures contract, ASX January 2009, gained Thursday, 23 October 2008 as a weaker US dollar boosted US wheat futures overnight.

 

The dollar will remain as a key factor in determining price direction rather than fundamentals. The whole commodity complex is moving with the dollar, if the dollar goes up, commodities come back and it has very little to do with fundamentals said Markus Helsing, head of futures at Tricom Equities Ltd., Thursday, 23 October 2008.

 

While the global wheat crop is in better shape that last year, when poor weather conditions destroyed crops, traders are increasingly worried about farmers' ability to secure credit, essential for planting of the 2009-10 crop.

 

It is going to get ugly for farmers planting next year's crops, said Helsing.

 

Australia is expected to harvest between 19.5 - 21 million tonnes of wheat, compared with a drought-affected 13 million tonnes last year.

 

Following a two-month downtrend, US wheat and Australian futures show signs of bottoming, with the US grains complex rocketing overnight.

 

Spillover strength from the US market helped ASX January futures gain, and at 0528 GMT, prices last traded at A$277 a tonne, up A$6 on the day, but still far below the intraday peak of A$392 / tonne attained a little over two months ago.

 

Overnight, Chicago Board of Trade (CBOT) benchmark wheat settled up A$47 1/4 cents to US$5.61 1/4. Australian wheat futures took on board only part of this positive lead because a lower dollar makes Australian wheat less competitive in the world market. The Australian dollar was last at 0.6677 against its US counterpart, up 3.9 percent on-day.

 

Helsing added, technicals are so dominant this year, he expects the US dollar to gain, particularly against the euro and commodities will hover round it.
   

Share this article on FacebookShare this article on TwitterPrint this articleForward this article
Previous
My eFeedLink last read