Miller Magazine Issue:114 June 2019

92 MARKET ANALYSIS JUNE 2019 The dollar rose against all Group 10 counterparts, whi- le safe-haven currencies fell after US President Donald Trump said he was in no hurry to enter into a trade deal with China. The yen declines during the first day of four, as the main parties of the European Union retained their positions against the populists in the elections, while the euro cannot hold back the morning growth, as the suc- cess of the European parties in Italy and France paint a mixed picture. Trump said he would wait for elections to Japan’s upper house in July before he made a deal. EUR / USD drops 0.1% to 1.1190 against 1.1215, the daily maximum. We always need to pay attention to the currency exc- hange rate, because it’s take huge influence on buying facilities or could make selling price more or less attrac- tive. USD/Argentinian peso is almost 43 and stay falling, Brazilian Real also filling not good: 4 and going down but slowly than peso. A weaker currency means that Brazilian farmers put more money in their pocket whenever they sell grain that is priced in dollars. So that too could have stimulated sales, the same for Argentinian and Ukrainian. China on Friday 31th of May will demonstrate its econo- mic results for May, and economists expect the official index of business activity in the manufacturing sector to fall to 49.9 amid a worsening trade war with the United States. It is expected that the Fed’s favorite indicator of core inflation will increase, showed a forecast before the publication of data on Friday. ARGENTINA Two weeks of decent farmer selling in Argentina, taking advantage of CBOT volatility. Soy crushers suffering from very low margins (around USD 15). Soybean crop is estimated in the range 56-57 MMT. Meal quality still an issue, being very difficult to reach 46.5%. Traders prefer Brazilian beans as for protein content and ready to pay preemie. Soybean crushing in April was 3.82 MMT. May is estimated at 4.2 MMT and June probably 4.3 MMT. Bean exporters have bought around 4 MMT and they remain active in the market. Year will probably end with soy exports at 7-8 MMT if trade war gets worse. Corn continue to be the big ‘battle’ for exporters. Har- vest progress at around 48%, progressing very slow in recent weeks as humidity is still very high and late plantings are far from being ready to collect. Line up is really heavy, and more than 11 MMT of this crop were already exported since late Feb. Farmers are not delivering as expected, and price skyrocketed for spot positions. Exporters tried to capture the inverse and committed big volumes before Brazilian Safrinha enter the game later in June. Final corn crop number will probably surpass 50 MMT. Better prices making it very profitable for farmers, motivating to plant more in 2019/20.