Nogger's Blog

17/10/11 -- EU grains finished mostly a little higher to start the week with Nov London wheat up GBP0.90/tonne to GBP147.40/tonne and Nov Paris wheat down EUR0.25/tonne to EUR184.50/tonne.

Fresh fundamental news was thin on the ground. Russia says it may introduce grain export duties, but only once it has dumped 23-24 MMT of cheap cereals onto the market which probably won't be until around March.

Kazakhstan meanwhile has almost completed it's bumper grain harvest and could export up to 13 MMT of it's own this season. Most of that will be wheat out of what seems likely to be a post-Soviet era 21 MMT crop - 2 MMT more than the USDA forecast.

Ukraine's silos are groaning under the weight of it's 2011 grain harvest awaiting the president's signature on parliament's proposal to scrap export tariffs on wheat and corn. Harvesting of the latter is approaching the halfway point producing 9 MMT to date.

Meanwhile northern areas of Western Australia's wheat belt are on track for record production with harvest already under way and in NSW some crops are described as "the best I've seen" by one Department of Primary Industries district agronomist.

Early stock market confidence in some sort of progress on the European debt issue when EU finance ministers meet over the weekend was based on comments using words like "decisive" and "clear answers" from the French finance minister.

Unfortunately those hopes were quickly dashed when Germany warned against "unrealistic expectations" from the meeting. Once again the lack of unison amongst the two leading protagonists trying to solve the crisis is quite alarming.

An ECB statement regarding Greece now said that no economic improvement is expected before 2013, adding that "the achievement of the fiscal target for 2011 is no longer within reach."

Early strength in the euro soon dissipated as investor optimism was dashed on the rocks once again.