Miller Magazine Issue: 113 May 2019

87 MARKET ANALYSIS MAY 2019 East is rainy. Australia as for last years completely dry. Russia expects another huge wheat crop near 83 MMT. Argentinian wheat production seeks to rise to 20.4 MMT and thus join the growth of the main exporting countries in 2019/20 TY. Weather favors most the territory of Russia, the USA, and EU, while Australia continues to depend on the rains. For the main analysts’ expectation, it could be 149 MMT for EU, 51 MMT for the USA, 34 MMT for Canada and 27 MMT for Ukraine. As for corn and soybeans, it’s too early to make forecasts. But for next month huge corn and soy production in the La- tAm will push exports higher and it will make pressure on prices. Anyway, Ukraine sold 23.9 MMT of corn for the 3rd of May and it record pace, exports capacity is 3-5 MMT for the beginning of the new season in September. Traders continue to grapple with record soybean stocks, rising corn stocks and good wheat potential so it’s strong export competition between major world suppliers. The only chance for soybeans and partly for corn is African Swi- ne Fever, not only at China, but also at Vietnam, Japan, and South Africa. Pork-producers should increase production to sa- tisfy the high demand. On Friday, 10th of May trading commu- nity should meet renew WASDE report. But will they? Usually, the May Supply&Demand Estimates is one of the biggest and the most important report of the year, because it gives the mar- ket the first glance for new grain and oils crop. As a baseline for the marketing year. But this year balance sheet looks wrapped up about trade war between the USA and China and weather give a lot of surprises. As I mentioned, China delegation will be coming to the White House, but the report will be ready on the same date so the May report will not be in the focus of attention this time. Much more attention we should pay to winter wheat condition and crop progress all over the world. So there is nothing to discuss this time. The only one winner for today is Brasil which soybeans offers increase on hopes of trade talk collapse. Again. This is the only short-term support for beans. One more point to make attention is EM currencies. Inves- tors are ready for any new turn in the trade dispute. The MSCI currency index consolidates around January while sto- ck market indicator tends to the longest February decline. As cheaper local currencies are, as more attractive other than US grains will be. Also, we should pay attention to the Argenti- nian economy: it’s not the first time for rumors about exports duties on IMF claim.