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Price forecast weekly from 21 to 25 of December 2020

Grain market:

The wheat market does not want to discharge itself yet. Prices remain at good levels for sellers. This is partly due to the pandemic, and partly to the condition of winter crops.

There is very little snow in the fields in the Volga region, and this is against the background of almost 20 degrees below zero. The negative for winter crops is immediately a decrease in the gross harvest of wheat by 10 million tons for Russia next year to the level of 75 million tons.

Given that the pandemic is forcing all countries to replenish and expand food supplies, we can see an increase in demand for wheat in the new year and even the emergence of some artificial shortages. Note that carryover stocks are estimated at 316 million tons, so the world will be able to afford a slight drop in gross harvest next year.

Reading our forecasts, you could make money on the oil market by taking the WTI move from $40.00 to $48.30 per barrel.

Price forecast weekly from 14 to 18 of December 2020

Grain market:

In China, 750 thousand people last week were tested for coronavirus in a single city due to another outbreak of the disease. The facts of the emergence of new foci only increase the level of stress in society, but there is nothing to oppose this except discipline and vaccination. France will meet the New Year in quarantine. In the United States, 90 people die per hour from COVID-19. These data drives traders into depression.

Against such a bleak backdrop, governments will tighten food security measures to support the grain market. Thus, high import demand in China and Pakistan contributed to the increase in world trade to a record level in November. Unprecedented demand from large importers led to a decrease in stocks in exporting countries and a strengthening of world prices. The food market will be in the spotlight next year.

Reading our forecasts, you could make money on the growth of the RTS index from 112,000 to 138,000 points.

Price forecast weekly from 7 to 11 of December 2020

Grain market:

China has drafted a new bill to oblige provinces to have storage facilities filled with grain. Food can be used only in case of emergencies. Thus, in 2021, one can expect high activity of China in the foreign market, since the storage facilities themselves will be built in three to six months and they will already have to be filled with something.

In Canada, wheat production rose 7.7% to 35.2 million tonnes in 2020. Total corn production for grain rose 1.2% to 13.6 million tonnes. The increase in indicators occurred both due to an increase in yield and due to the cultivated areas.

On the electronic trade platform IDK.ru, the OZK Group purchased 1,200 tons of wheat with a total value of over 22 million rubles on the Novorossiysk basis. 19 accredited traders took part in the auction. Trading scheme — English and Dutch auctions.

Reading our forecasts, you could make money on the oil market by taking a move from 42.00 to 50.00 dollars per barrel. And also, you could earn on the gas oil contract, taking the move from 340.0 to 400.0 dollars per ton.

Price forecast weekly from 30 November to 4 of December 2020

Grain market:

Thanksgiving in the United States has made the past week a little messy. In general, the market remained at the same levels. I would like to note the positive, which brings the expectation of the beginning of the active stage of vaccination, which will allow to reduce the rate of spread of the virus in the spring. So in Russia the program starts in December.

The more moisture accumulates in the fields, the less risk there will be for a failed 21/22 season. Thus, favorable weather in December, relatively warm with a lot of precipitation, is able to keep prices down.

In addition, if quotes remain at current levels, then many farmers in the United States and Europe, who did not believe in wheat before, will prefer to focus on this crop in the spring, as current prices are in line with 2014 levels. The increase in acreage is also able to restrain the rise in prices on the grain market.

At the moment, we can note an unsuccessful attempt to rise above 600.0 for wheat, and an unsuccessful attempt to storm 430.0 for corn, which may lead to a corrective move in the near future.

By reading our predictions, you could have made money in the gold market by taking a move down from $ 1890 to $ 1780 per troy oz.

Price forecast weekly from 23 to 27 of November 2020

Grain market:

The grain market is strong. Wheat is below the 600.0 level, while corn is growing moderately with no plans to visit 435.0 cents a bushel.

Increased demand for feed from China and Europe, coupled with a sharp drop in the actual corn harvest in Ukraine by a serious 8 million tons, which is 22%, forced grain prices to remain at high levels.

Reports of positive testing for a number of vaccines led bidders to be positively charged. There are no prerequisites for a drop in demand now, but there are prerequisites for a poor harvest in 2021. Particularly, due to the La Niña effect, which will dry up the entire south of the United States next summer. This could lead to a stronger rise in prices next year.

Price forecast weekly from 16 to 20 of November 2020

Grain market:

The grain market corrected after a phase of active growth. The main question for the next week or two is whether the correction is over or not.

Fundamental reasons for price increases can only emerge if producers begin to experience logistical problems in supplying crops to their own ports for export. So far, nothing is known about such problems.

At the moment, the market is perceived to be quite balanced, given the harvest volumes of the current season. In the future, the emphasis will shift to the accumulation of moisture in the fields during the winter months. There may be surprises that can support the quotes.

Wheat and corn prices are likely to rise by 10-12% by the end of the year, but we are unlikely to see stronger growth.

Reading our forecasts, you could make money on the soybean market by taking a move up from 1050.0 to 1150.0.

Price forecast weekly from 9 to 13 of November 2020

Grain market:

Biden can celebrate. Is his victory easier for the rest of the world?

Taking into account the fact that with his arrival the markets assess the prospects of the dollar in a negative way, it is enough to look at the behavior of the euro and gold, it will become somewhat easier for many countries with dollar debts. Those who have collected the reserves of this currency, China and Japan, will have to be ready to come to terms with losses.

With the arrival of the Democrats, the grain market should become more elastic, which implies smooth, free from strong jumps in price changes.

The United States, now clearly, will come under the control of a cohort of individuals, rather than one person who frightens the world through Twitter. All reasonable humanity counts on the fact that Biden, due to his age, will be a waxwork, but not a person with real power. Otherwise, Trump’s reign will seem like a cute prank to the World.

By reading our forecasts, you could have made money in the natural gas market by taking a move up from 2.450 to 3.080.

Price forecast weekly from 2 to 6 of November 2020

Grain market:

In the United States next week, there will be a US presidential election. Candidates with more than a solid age for such a position: Trump 74, Biden 77, will try to earn the trust of Americans.

If Biden wins, one can count on more active foreign trade and fewer trade wars, which should lead to a more efficient distribution of produced goods and resources, and, possibly, a softer confrontation along the Washington-Beijing line.

Going forward, easing international trade tensions and reducing American protectionism will allow the agricultural market to function more efficiently.

The grain market is likely to welcome Biden’s victory with slight optimism. Wheat and corn prices will receive some support.

In the event of Trump’s victory in the market, the tendency to high volatility will remain, trading will go on at a nervous ragged pace.

Reading our forecasts, you could make money on the fall in the RTS index futures from 112500 to 108000.

Price forecast weekly from 26 to 30 October 2020

Grain market:

Panic buying of grain from the new harvest is doing its job. Exchange prices for wheat in Chicago have not yet rolled back and are claiming to reach the level of 670 cents per bushel, which is comparable to FOB prices around $ 260 per ton.

The World Bank has estimated the rise in food commodity prices in July-September 2020. On average, prices rose 6% — with growth seen in almost all categories.

In October, growth continued in almost all agricultural crops and processed products. Only coffee is allocated, the cost of which decreased in October.

Rising food costs will hit the poor, keeping governments in suspense in many countries as discontent rises.

The situation could become even more dramatic next year due to the autumn drought in the Black Sea region and the Volga region this fall, as well as due to the drought in the southern United States next year due to the La Niña effect in the Pacific Ocean.

Price forecast weekly from 19 to 23 October 2020

Grain market:

The forecast for global wheat production in the 20/21 season was raised this month by 2.6 million tons to 773.08 million tons on the back of a larger crop in Russia and the EU than previously expected. Wheat production in Russia is projected to become the second-largest in history due to increased production of spring wheat, in particular in the Volga and Central districts.

Expansion of production and reserves in Russia helps to increase the country’s exports by 1.5 million tonnes in 2020/21. According to the forecast, the volume of Russian exports in 2020/21 will amount to 39 million tons, second only to the figure of 2017/18, when 41.5 million tons were exported.

Exchange prices are pushed up by increased demand from importing countries amid the pandemic. The structure of food consumption by the population is changing, shifting towards grain and vegetable oils. For example, domestic consumption of wheat in China this year will reach a record 130 million tons.

It is likely that after the pause, prices for soft red wheat in Chicago will hit 675 cents a bushel.

PRICE FORECAST WEEKLY from 12 to 16 October 2020

Grain market:

USDA data released on crops. The forecast for the gross harvest of wheat in the world increased by 0.34% to 773.082 million tons. The forecast for gross corn harvest fell by 0.31% to 1,158.816 million tons.

After the release of data on Friday, the wheat market stopped growing, the corn market continued to move up.

Both crops continue to be in an upward trend despite record harvests. This is due to the desire of importers to create more substantial stocks of food in case countries have to introduce strict quarantines due to the virus, which will lead to paralysis in ports for a while.

Reading our forecasts, you could make money in the wheat market by taking a move up from 492.00 to 600.0.

PRICE FORECAST WEEKLY from 5 to 9 October 2020

Grain market:

The market has reached an equilibrium position and is in no hurry to get out of it. The quarterly data from the USDA on grain stocks in the US, although they turned out to be worse than expected, could not fundamentally improve the position of bulls in the market.

So, after the upward price jump in the wheat market, there was an immediate pullback downward. This tells us about a large number of sellers who are ready to sell contracts when approaching the level of 600.0 cents per bushel.

The Ministry of Agriculture of the Russian Federation has raised the forecast for grain harvest this year. The ministry expects that it will receive more than 125 million tons of grain and pulse crops, including wheat — at least 82 million tons, which is 7.5 million tons more than a year earlier. In the summer, the ministry estimated the grain harvest this year at 122.5 million tons, including 75 million tons of wheat.

Reading our forecasts, you could have made money on the USD/RUB pair by taking a move up from 73.10 to 78.90, and in the corn market, also taking a move up from 362.0 to 379.0.


Grain market:

The strengthening of the dollar last week suspended the growth of prices for wheat and corn, however, for now we cannot say that a downward reversal is outlined in the grain market.

The IGC has cut its forecast for cereals global production (wheat and coarse grains) in 2020/21 by 3 million tons compared to last month to 2,227 million tons. The new crop is up 46 million tonnes from the previous year, driven primarily by a 39 million tonne increase in corn production to a record 1,160 million tonnes.

Prices will not be easy to rise against the background of actual abundance. At this stage, the market can only be pushed up by fears of coronavirus and local collusion of exporters, which is unlikely to last long, since not everyone has long-term storage opportunities. In order not to ruin the grain, very soon a number of companies will offer their products at tenders at prices lower than those of competitors.