Volatility in commodity exchanges should discourage speculation: Agritel
Yesterday's (June 17) session was impressive with a massive wave of liquidation on all products, mainly driven by funds. This unprecedented volatility should discourage any speculation and push the operators to be extremely cautious, Agritel analysts argue.
As reported, the reason for the sell-off remains the improved weather situation in the US. A new 10-day forecast is suggesting further rainfall and milder temperatures.
Despite improved weather outlook, 41% of Iowa's acreage remains in water deficit. Iowa is a major corn and soybean growing state.
"The current thunderstorms in France are welcome, provided that they do not cause damage or last too long to compromise the quality aspects. In Russia, while conditions remain favourable in the south of the country, Agritel's analysts are still warning of a water deficit in the central zone, mainly affecting spring wheat," the report reads.
In Argentina, maize yields have been revised upwards and the Buenos Aires exchange has posted a crop estimate of 48 mln t. 57% of the wheat area was estimated to be planted as of yesterday.
Rapeseed prices dipped sharply yesterday in the wake of soybean oil. There were rumours that the Biden administration would relax biodiesel blending requirements. Canola reached its limit down yesterday as rains are expected in the south of Canada.
In its Special Report on Drought 2021, the UN underscores that addressing the drought issue may become critical for agriproducers in the major commodity regions.