eCBOT Close, Early Call

The overnight grains closed lower, with beans around a cent or so easier, corn down 3-4 cents and wheat off 5-6 cents.

The dollar is firmer on a wave of risk aversion and profit-taking. Rumours of Ukraine debt defaults have got the market a little nervous. Crude oil is lower and the shine has disappeared from gold the past day or two after a secession of all-time highs were set earlier in the week.

There's not much change in the US weather forecast with light to moderate rains set for early next week. In South America though significant rains are in the forecast for Argentina, with even the parched south and west getting a chance of 1-2 inches Monday/Tuesday. In parts of Brazil if anything it remains too wet, with Parana in for 10+ inches in the next fortnight, according to QT Weather.

China continue to buy US soybeans at an unprecedented rate, as confirmed by yesterday's USDA export sales and shipments numbers, plus an additional sale of 116,000 MT.

The news today that the Chinese government is to cease it's weekly soybean and corn auctions from Dec 1st could also be seen as supportive. Heavy snow in northern areas is also supportive as it will hinder transport and could potentially lead to a reduction in wheat area and yields.

India says that it has planted around a third of it's intended wheat area for the 2010 crop at 9.39 million hectares.

Profarmer and the Commonwealth Bank of Australia have both cut their wheat production estimates there, coming in around 2-3 MMT lower than the USDA's current estimate.

It looks as if we could be in for a lower end to the week, with funds likely to keep their powder dry until Monday. Early calls for this afternoon's CBOT session: corn called 3 to 4 lower; soybeans called 1 to 2 lower; wheat called 5 to 7 lower.

Here's An Interesting Thing

Figures out today from the Russian customs department show that they exported just over 2 MMT of wheat in October, bringing exports for the current marketing year so far (July/Oct) to just under 7 MMT.

What's so interesting about that, you rightly ask?

One of the takers in October was ultra-fussy we don't need to import anything India with 24,600 MT, apparently.

Barley Market Will Soon Be On Fire - Simon Cowell

Multi millionaire pop guru and that bloke off the telly who wears his trousers too high, Simon Cowell, says that the global barley market is all set to the next big thing.

Announcing plans to personally groom barley for stardom, Cowell says that he's confident he can "sex-up" the grain by giving it a short skirt and a skimpy lycra top.

"I'm going to relaunch barley with a whole new glittering image, everyone will want it, it'll be £200/tonne by Christmas mark my words," gushed Cowell.

Ukraine: The Golden Goose Is Dead (Maybe)

Rumours are sweeping the market that Ukraine Rail has failed to restructure its debt on a bond owed to Barclays Bank.

This rumour is compounded by speculation that a second bond is near default - one that is underwritten by Ukraine's government and owed to Deutsche Bank.

That's got the currency markets spooked and we are back to a flight to safety, which sees the unpopular pound taking a spanking in the corner down to USD1.6475.

On a separate issue, to highlight just how badly the bottom has fallen out of the agricultural market in Ukraine, the production of tractors for agriculture and forestry purposes fell by 85.1% in January-October 2009 year-on-year, according to the State Statistics Committee.

The production of seeders shrank by 81.5% and the production of disk harrows fell by 85.7% during the same period, they add.

Rice Market Simmering Nicely

Whist the poor monsoon season slashed Indian summer rice production, flooding in the south of the country is seen doing likewise with winter rice output, analysts say.

That could leave India needing to import 3-5 MMT of rice next year, which considering that they are normally an exporter of around 4.5 MMT, is a pretty significant turnaround.

This would be the first time India has needed to import rice in more than twenty years, and also coincides with a pick up in demand from the Philippines, who have had their own production slashed by a series of typhoons.

India lost 18% of it's summer rice crop and could lose a similar proportion of it's winter production, analysts say.

That would slash stocks perilously low to under 1 MMT, without imports, and that is only enough to keep hungry India going for just four days.

Government mandates insist that state food agencies hold minimum stocks of 5.2 MMT of rice, pushing import requirements up above 4 MMT in 2010.

Strangely, the Commerce and Industry Minister Anand Sharma told reporters today that the government "have adequate stocks" after refusing to offer a subsidy to state-run companies looking to import rice.

Breaking News

Just popped up on the screen that China's CNGOIC website says that the regular weekly government soybean and corn auctions that have been in operation since September are to cease from Dec 1st. No explanation offered.

That might get the market going this afternoon, particularly after yesterday's strong sales and exports news.

The thoroughly excellent say that "this left US soybean sales for the 2009-10 marketing year, which only started in September, at more than 70% of Washington's full-year forecast already" which is a pretty startling statistic, I'm sure you'll agree.

US sales to China, which have been running at almost a million tonnes a week recently, look like continuing unabated.

Chinese soybean imports are expected to be around 3.5 MMT in November, rising to 4 MMT each in Dec and Jan, with the vast majority of that set to come from the US, before the Brazilian harvest gets into full swing.

Things Could Be Worse, You Could Be Indian

Food inflation running at 14.55%, prevented from importing foreign wheat in bulk by the strictest quarantine regulations in the world. Whilst the government sits on it's supposed stocks of 27 MMT of wheat, which it will only sell if you want to pay well over the market price for it.

And this is a government who got elected on their promises of cheap food for all. Is it just me, or is there something innately immoral about buying USD6.7 billion worth of gold from the IMF whilst the people are starving?

Subsequently smarting at allegations that they are a load of profiteers who are so bent that they can't lie straight in bed at night, the government are now said to be 'considering' lowering their minimum tender price for wheat from a laughable USD292-USD365/tonne to the equivalent of USD240-290/tonne.

Well whoopee do. Considering that they've been 'considering' whether to release any wheat or not for months now, I wouldn't go holding my breath for a snappy decision on that one.

They should try 'considering' that the average Indian on the street can't afford to be paying almost 15% more than last year for his food, and get their fingers out.

Sell their domestic stocks off cheap, what are they there for food security or profit? Failing that, waive the strict import regulations as they did back in 2006. Nobody can seriously tell me that the wheat in the state granaries is better quality than the French or German material that Egypt just bought at below USD200/tonne yesterday.

Meanwhile, the opening day of parliament was adjourned yesterday after angry farmers marched through the streets of Dehli, protesting against low state-set sugarcane prices. The dispute may delay cane crushing in Uttar Pradesh, pushing domestic sugar prices even higher, and could also affect early sowing of wheat, farm leaders said.

I'll Name That Country In One

Public borrowing in October running at a staggering 88 times what it was in October 2008. Public debt left to spiral out of control by a hapless government so inept that even if it did act to reduce its deficit, it would still be the 'rich' world's largest until at least 2017.

A government who's publicly stated aim is to create a law to reduce the deficit every year for the coming decade, that they look set to break in it's very first year in existence!

Look away now if you don't want to know the score

EU Barley Pouring Into Intervention

With the current depressed price of barley, and lack of a decent premium for malting varieties, 1.56 MMT of grains have already been offered into intervention during the first fortnight of the programme being open.

Whilst a small amount of wheat has been offered, the vast majority of that total is barley.

At this rate, trade estimates that EU-wide 4-6 MMT of mostly barley could be offered for intervention before the season ends on 30 June 2010, might prove to be far too low. That should take up some of the slack, and do exactly what intervention is designed to do.

The fact that there won't be any barley intervention for the 2010 crop, but stores full of it, will surely have led to a greater reduction in plantings than the 6% drop currently being forecast by Strategie Grains. Nobody is that stupid. Are they???

Analysts Cut Australian Wheat Crop Estimates As Temperatures Hit 46 Degrees

November temperature records are being broken all over eastern Australia, with much of New South Wales seeing the mercury hit 10 to 20 degrees above their November average today.

The hottest today was felt through the Upper Western where Wanaaring and Brewarrina reached 14 degrees above average at 46 degrees, making it their hottest November day on record. Other November records broken through the state were at Cobar, Condobolin, Forbes and Trangie all reaching a toasty 45 degrees, according to Elders Weather.

With the wheat harvest well underway lower yields than expected are being reported, not just in NSW but also Victoria and Western Australia. Current sweltering temperatures may knock a bit more off yields yet in late maturing crops, analysts say.

Profarmer Australia yesterday cut their Australian wheat production estimate by 1 MMT to 20.9 MMT, whilst Commonwealth Bank of Australia lopped 700,000 MT off their output ideas to 21.6 MMT.

Both estimates are considerably lower than the hapless USDA's current stab in the dark of 23.5 MMT.

Profarmer now peg Australian barley production at 7.0 MMT and canola output at 1.67 MMT.

CBOT Closing Comments


CBOT Jan soybeans ended 12 cents higher at USD10.39, and March soybeans settled 11 1/2 cents higher at $10.44 3/4. Soybeans finished higher after trading lower overnight and in the early part of the morning session. Weekly export sales were bullish soybeans at 1,349,700 MT against expectations of 750,000 and 950,000 MT. Exports of 1,724,200 MT were a marketing-year high, the primary destination (no surprises here) was China at 914,500 MT.


December corn futures closed at USD3.95, down 3 cents; March corn futures at USD4.10 ¾, down 3 cents. Weekly corn sales were poor at 352,900 MT compared to trade estimates of 450,000 to 550,000 MT. Export shipments were 683,200 MT down 10% from last week and 7% from the four week average.


December wheat futures ended at USD5.62 ½, down 3 ¾ cents. Wheat had been heavily down earlier in the session but recovered to close near to unchanged on ideas that wheat is the "undiscovered laggard" of the day. Funds seem to be looking for something to latch onto at the moment, and wheat seems to fit the bill.

EU Wheat Closing Comments

Paris January milling wheat futures closed down EUR0.75 at EUR133.50/tonne, and London May feed wheat ended down GBP1.00 at GBP112.00/tonne.

Egypt bought 60,000 MT of Russian wheat from Louis Dreyfus at USD196.50/tonne, 60,000 MT of French wheat from Granite at USD198.65/tonne, and 55,000 MT of German wheat from Cargill at $198.75/tonne in this weeks tender.

It might be interesting that the tender was split three ways origin-wise. Stories are circulating that whilst Russian wheat may be the cheapest, there are also contamination problems associated with it.

The UK exported 172,402 MT of wheat in September, bringing the cumulative total for the marketing year which began on July 1st to 438,169 MT, say Defra.

Allowing for usage from Ensus, that potentially leaves the UK a surplus of 'only' around 140,000 MT per month to export during Oct 09/Jun 10, which would not appear to be an unachievable target.

We also exported 107,386 MT of barley in September, taking the current MY total to 263,437 MT, said Defra. That's slightly above last year's pace of 215,315 MT, but still leaves plenty to be exported or go into intervention.

eCBOT Close, Early Call

The overnight grains closed lower with beans down around 6-7 cents, corn off 5-6 cents and wheat down around 12 cents.

The dollar is suddenly sharply firmer whilst gold, copper, crude, equities and all the other outside markets are off their highs on what looks more like profit-taking than a fundamental change in direction.

Weekly export sales were bullish soybeans, neutral wheat and bearish corn. Bean sales came in at 1,349,700 MT against expectations of 750,000 and 950,000 MT. Exports of 1,724,200 MT were a marketing-year high, the primary destination (no surprises here) was China (914,500 MT).

Wheat sales were so-so at 362,400 MT, whilst corn sales were poor at 352,900 MT compared to trade estimates of 450,000 to 550,000 MT.

Private exporters have today just reported a sale to China of 116,000 MT of soybeans for the 2009/2010 marketing year.

China is seen increasing it's soybean imports over the next few months, which should certainly favour US beans for a month or two yet. Heavy snow is seen affecting logistics and transportation, which may also lead to an increased reliance on imported beans over home produced material.

Japan bought 113,000 MT wheat in it's normal weekly tender - 71,000 MT US origin and 42,000 MT Australian origin for dely Dec. 21 - Jan. 20.

Australian wheat might be suffering from soaring temperatures in the East, whilst heavy snowfalls in northern China's wheat belt might also hit yields for next year.

Egypt is tendering to wheat again this week, Russia would look the probable favourite again, although French wheat might get a look in on the quality angle.

Will the fund money continue to flow into the ags today/tomorrow? That would appear to be the six million dollar question.

Certainly there's more bullish news around for beans today with large weekly sales, record exports and another spot sale to China.

For now early calls for this afternoon's CBOT are: corn called 5 to 7 lower; soybeans called 4 to 6 lower; wheat called 10 to 12 lower

Heatwave Might Trim Australian Wheat Yields

Eastern Australian farmers might be thanking their lucky stars that this year's much-touted El Nino event didn't arrive on the scene Down Under earlier than now, or wheat production this season might have been severely curtailed.

Much of western New South Wales sweltered in near-record heat today as temperatures soared to the high 30s and low 40s. In some parts of the far west of the state highs of 46 degrees were hit, and tomorrow is forecast to be even hotter.

The current record heat wave, which has caused kernel-shriveling that will reduce wheat yields, became established in a very dry October where conditions damaged wheat in the top 2 producing states of Western Australia and New South Wales, say Martell Crop Projections.

Victoria also report crop damage and reduced yield expectations.

USDA Weekly Export Sales

For the period November 6-12, 2009 the USD today reported the following weekly export sales:

Wheat: Net sales of 362,400 MT, with the main takers Philippines (98,600 MT), Nigeria (83,500 MT) and Taiwan (67,500 MT). Trade estimates for weekly sales ranged from 350,000 to 450,000 MT. Exports of 486,900 MT were up 7 percent from the previous week and 18 percent from the prior 4-week average. The primary destinations were Nigeria (107,300 MT), Japan (71,600 MT) and Taiwan (57,100 MT).

Soybeans: Net sales of 1,349,700 MT were up 6 percent from the previous week and 58 percent from the prior 4-week average. Once again the primary destination was China (724,700 MT). Trade estimates for weekly sales had ranged from 750,000 and 950,000 MT. Exports of 1,724,200 MT were a marketing-year high, the primary destination (no surprises here) was China (914,500 MT).

Corn: Net sales of 352,900 MT were below trade estimates of 450,000 to 550,000 MT. Japan (187,200 MT) was the main taker. Exports of 683,200 MT were down 10 percent from the previous week and 7 percent from the prior 4-week average. The primary destinations were Japan (221,200 MT), Mexico (141,600 MT) and South Korea (114,600 MT).

EU Rapemeal Prices

Basis FOB Hamburg/Lower Rhine in euros/tonne:

Nov 132,00
Dec 132,00
Jan 132,00
Feb/Apr 131,00
May/1st h Jly 122,00
Aug/Oct 10 119,00
Nov/Apr 11 129,00

UK Grain Exports Latest

The UK exported 172,402 MT of wheat in September, bringing the cumulative total for the marketing year which began on July 1st to 438,169 MT, say Defra.

You might recall that Defra recently pegged the UK exportable surplus at 2.16 MMT, although that inexplicably made no allowance for usage from the bioethanol sector.

With Ensus set to shift into production in January, there is clearly likely to be a significant hole made in that during the first half of 2010.

Exactly how big a hole that will be remains to be seen, Frontier's latest market report suggests that 450,000 MT might be close to the mark.

If they're right, then that leaves us with a surplus of 'only' around 140,000 MT per month to export during Oct 09/Jun 10, which would not appear to be an unachievable target by any stretch of the imagination.

We also exported 107,386 MT of barley in September, taking the current MY total to 263,437 MT, said Defra. That's slightly above last year's pace of 215,315 MT, but still leaves plenty to be exported or go into intervention.

Heavy Snows Might Hit Chinese Wheat Production

The Chinese government may have shot themselves in the foot with their cloud seeding efforts in northern China's wheat growing areas.

Warm and dry October weather hampered wheat planting and development on the North China Plain. Rainfall had been practically non-existent in October in leading wheat provinces Henan and Shandong and adjacent Anhui and Jiangsu, say Gail Martell of Martell Crop Projections.

So the military were duly dispatched into the countryside armed with the usual array of silver iodide and heavy artillery.

The seeding, plus temperatures falling as low 29 F, brought an early covering of 'fake' snow to Beijing on November 1st. The snow was the earliest to hit the capital in 10 years, according to the Beijing Evening News.

Perhaps what the authorities hadn't reckoned with was that Mother Nature has seen fit for it to continue to snow more or less ever since.

The heaviest snow in 22 years hit Hebei last week, with falls as deep as 37 cm in some parts of the province. The snow has been accompanied by bitterly cold weather with temperatures of minus 15 to minus 17 degrees Celsius, according to the Xinhua News Agency.

The drastic temperature drop will harm the province's 2.4 million hectares of wheat, said Zhang Wenzong, director of Hebei Agri-Meteorological Center.

The sudden switch from almost summer-like conditions to winter seems to have by-passed autumn completely. Whilst the snow will certainly ease the drought, it's early arrival along with sub-zero temperatures will badly affect further planting and potentially send newly planted wheat into premature winter dormancy.

They might be able to make it rain, but can they stop it snowing and freezing in the world's largest producer and consumer of wheat?

CBOT Closing Comments


January soybeans closed are at USD10.27, down 2 ½ cents, December soymeal futures at USD310.50, up USD1.80, December soy oil futures at 39.75 down 6 points. Beans were sharply higher in early trade, but gave up those gains on profit-taking as the session wore on. Tomorrow will be interesting with estimates for the USDA's weekly export sales report at between 750,000 and 950,000 MT. Last weeks sales were strong at 1,272,500 MT, and this week's inspections for export shipments were a very robust 1,628,715 MT.


December corn futures closed at USD3.98, down 4 cents and March corn futures at USD4.13 ¾, down 3 ¾ cents. After challenging recent highs corn futures closed lower on the day, failing to close above the psychologically important USD4/bushel mark. Trade estimates for tomorrow's weekly export sales report range from 450,000 to 550,000 MT. Last weeks sales were 488,500 MT, and corn inspected for export shipments this week was 631,800 MT. The US weather outlook looks conducive to getting a fair proportion of the remaining corn harvested over the remainder of the week, albeit at high moisture levels.


December wheat futures closed at USD5.66 ¼, down 8 ½ cents. Trade estimates for tomorrow's export sales range from 350,000 to 450,000 MT, with last week's sales at 412,200 MT. Wheat inspected for export shipments this week was 409,512 MT. That means that there's a lot of catching up to do to meet the current USDA export projections for wheat. Egypt are tendering again this week for one or two cargoes of wheat, after booking 295,000 MT of Russian wheat in last week's tender.

EU Wheat Closing Comments

EU wheat futures closed with November London feed wheat up GBP0.50/tonne at GBP105.65/tonne and with Paris January milling wheat down EUR0.50/tonne at EUR134.25/tonne.

Strength came from firmer outside markets once again, with gold hitting all-time highs and crude oil testing USD80/barrel, spillover strength entered the grains markets.

US wheat has also been propelled sharply higher in recent sessions, which also added some strength, although export interest still remains light.

Egypt's GASC are back in the market again this week, tendering for one or two cargoes of wheat. Last week they bought 295,000 MT of all Russian wheat, that is probably the most likely supplier again this week, although some reports of widespread bug damage to Black Sea grain are circulating the trade.

The thick end of 1 MMT of grain, almost all barley, was put up for entry into the EU's intervention scheme during the first week of November. Of that, Germany offered 276,089 MT and France 159,170 MT.

Wet weather and weak cash prices mean that US SRW wheat producers are expected to reduce plantings by 18% to 20% from last year.

Baltic Dry Index Scales New Heights

The Baltic Dry Index - the benchmark guide to drybulk shipping rates on 40 routes across the world - is up almost 6% at 4643 today, it's fifteenth day of straight increases.

The index has now risen 115% in less than two months, from a low of just 2163 set as recently as September 24th 2009, and now stands at it's highest level since September 2008.

You can follow the Baltic Dry Index using Nogger's widget on the right under the heading Interactive Charts.

eCBOT Close, Early Call

The overnight grains closed with beans around 16 cents firmer and corn & wheat 3 cents or so higher.

Crude oil was higher testing USD80/barrel again after yesterday's data from the API showed a surprising 4.4 million barrel decrease in stocks last week. The US Energy Dept are out later today with their estimate.

The US Consumer Price Index has just come out at 0.3% growth at the end of October, a little better than the 0.2% that the trade expected.

Outside markets continue to lend support with gold hitting record highs again and copper hitting a new 14 month high. The FTSE 100, Dax and CAC are all a bit firmer in European trade, and Wall Street is expected to open likewise.

Bangladesh bought 100,000 MT of Ukraine wheat earlier in the week, and announced a new tender for 60,000 MT of wheat overnight.

A trickle of imported wheat has started arriving in India's southern ports in containerised shipments, having cleared customs satisfactorily, the Roller Flour Mills’ Federation of India would like the government to now open up the way for larger bulk imports.

A report on Reuters suggests that Black Sea wheat is plagued by bug damage this season and buyers like Egypt might be forced to look elsewhere for grain that meets thier stringent quality criteria.

Argentina received valuable heavy rainfall over the weekend that replenished field moisture for soybean planting in Cordoba and Santa Fe. However, a stubborn drought is hanging on in Western Buenos Aires and La Pampa, say Martell Crop Projections.

Political problems caused wheat plantings there to fall to the lowest on record this year, corn seedings are also seen around 25% lower this year with farmers hanging their hats on an increased soybean acreage. The crop is far from made yet however, and Oil World have dropped their soybean production estimate by 4 MMT already this month citing drought and low seed quality. They currently peg the crop 5 MMT lower than the USDA's recent guesstimate at 48 MMT.

There are no such problems in Brazil, if anything they've had too much rain, which has caused wheat production to be slashed by around 20% from the 6 MMT expected earlier in the season to circa 4.75 MMT now.

It's early days for soybeans, but most analysts see a record 63-64 MMT output in 2010 as things stand at the moment. That harvest will start in just one months time in some places.

Early calls for this afternoon's CBOT session: corn up 2-4, beans up 13-15, wheat up 3-5.

Almost A Million Tonnes Of Wheat/Barley Already Offered For Intervention

In the first week it was opened almost a million tonnes of wheat & barley was offered up for intervention in the EU, according to reports.

By Nov 8th 95,834 MT of wheat and 852,981 MT of barley was offered, with very significant quantities coming from Germany and France at 276,089 MT and 159,170 MT of barley respectively. On the Continent the current intervention price is EUR101.77/tonne.

In the UK only a little over 5,000 MT of barley has been offered so far at the current price of just under GBP91/tonne delivered.

Analysts expect that EU-wide 4-6 MMT of mostly barley could be offered for intervention before the season ends on 30 June 2010.

EU Soymeal/Pellets Prices

Basis CIF Rotterdam/Amsterdam in USD/tonne unless otherwise stated:

Brazil pellets 48%

Afloat 436,00
Nov 436,00
Dec 436,00
Jan/March 405,00
May/Sep 353,00

Argentine pellets 44/45%

Spot Fob 422,00
Dec 426,00
Jan/March 410,00
May/Sep 343,00

Dutch Hipro 49% profat

Dec 454,00 FOB
Jan 449,00 FOB
Feb/Apr 432,00 FOB
May/Jul 372,00 FOB
May/Oct 375,00 FOB

Argentine Hipro 49% profat

Afloat 445,00-443,00
Nov 442,00
Dec 440,00
Jan/March 425,00
May/Sep 358,00

Bug Damage A Problem In Black Sea Wheat

An interesting report on Reuters suggests that damage by bugs is a serious problem in this season's Black Sea region wheat crops.

Quoting the Vice President of Global Technical Governance at SGS Agricultural Services, they say that Russian wheat this season typically has an average of 2.6% bug damage, with Ukraine wheat damage estimated at an average 4.6%. In some parts of the Ukraine bug damage has been as high as 80% he says. No wonder they're so keen to get rid of it, still it saves a few bob on loading charges when the wheat can walk onto the boat by itself.

As well as climatic conditions, much of this season's wheat problems can probably be attributed to economising on pesticides in these cash-strapped times, he says.

With Egypt having recently lowered it's maximum tolerance to bug damage to just 1%, in theory that leaves the door open for better quality European or US wheat to make inroads into 'difficult' homes like Egypt and perhaps even India.

Not that you'd know it the way recent tenders have been going, with Russia picking up the lion's share once again of late. Of course winning a tender isn't quite the same as having your wheat clear customs on delivery. There's nothing like a rejection or two and some hefty demurrage charges to sharpen the mind.

EU Bioethanol Plants Under Construction

I stumbled across this interesting list of bioethanol plants currently under construction in Europe today which I thought you might find interesting (capacity in million litres per annum):

Country Company Capacity Feedstock
Bulgaria Euro Ethyl GmbH (Silistra) 30 Maize
Crystal Chemicals 13
Denmark Dong Energy (Kalundborg) 17.6 Straw,
France Roquette (Beinheim) 35 Wheat
Germany Wabio Bioenergie (Bad Köstritz) 8.4 Waste
ESP Chemie GmbH 140
Hungary First Hungarian Bioethanol Kft 90 Maize
Lithuania Bioetan 100 Cereals
Netherlands Abengoa (Rotterdam) 480 Wheat
Nivoba BV (Wijster) 100 Cereals
Slovenia Slovnafta (Bratislava) 75 Wheat
Spain Biocarburantes Castilla & Leona 5 Ligno-
SNIACE II (Zamora) 150 Wheat
Alcoholes Biocarburantes Albiex 110
UK Ensus plc (Teesside) 400 Wheat
Vivergo (Hull) 420 Wheat

First Imported Wheat Shipments Clear Indian Customs

Fed up waiting for the government to release state-owned wheat stocks onto the market at realistic prices, flour millers in southern India have taken matters into their own hands and begun importing wheat in containers from Australia.

Media reports from India confirm that "a few containers have arrived and they have been cleared by the phyto-sanitary and plant quarantine authorities”.

Suppliers in Australia literally have to clean the wheat before it leaves to meet stringent Indian quarantine restrictions, but with prices fetching USD300-315/tonne (Rs 13,900-14,575/100kg) CIF the southern Indian port of Tuticorin there are plenty prepared to take the risk.

From the flour millers point of view it's a win-win deal, local wheat is costing Rs 15,400-15,800/100kg, availability is tight and what is available has high levels of infestation (typically 5-6%).

When the first few deals were done a risk premium of USD25/tonne was being added by the sellers, pessimistic that the wheat would get customs clearance. Now that the first consignments have got through OK, this has dropped to USD7-8/tonne, with more sellers now coming forward, say millers.

The Roller Flour Mills’ Federation of India is urging the government to relax the strict quarantine regulations until new crop wheat is available in March, to facilitate bulk imports. But for now the government continue to stick their heads in the sand. Their mysterious 27 MMT or so of strategic stocks remains under lock and key, yet neither do they seem prepared to open the doors to wholesale wheat imports.

Russian Grain/Oilseed Prices

Latest known guide prices basis ex-silo, southern Russia in USD/tonne:

First grade milling wheat 191,00 +2,00
Second grade 179,00 unch
Third grade 151,00 -2,00
Fouth grade 139,00 -1,00
Fifth grade 118,00 -2,00
Feed barley 94,00 +4,00
Sunseed 330,00 +15,00
Sunseed oil 833,00 +27,00
Soybeans 415,00 -30,00
Soybean oil 685,00 unch
Rapeseed 290,00 unch
Rapeseed oil 840,00 unch

Crude Oil Back To Test USD80/Barrel

Crude oil is back up testing USD80/barrel after a report from the American Petroleum Institute surprised the market, saying that inventories fell 4.37 million barrels last week to 333.1 million. A small increase in stocks had been expected.

A weak dollar and stronger equities and gold are also spilling over into the crude oil market, adding additional strength.

The US Dept of Energy are out at 15.30 GMT this afternoon with their stocks estimate, if they concur with the API, as they do around 75% of the time, then crude could get another shot in the arm this afternoon and be propelled above USD80/barrel.

It certainly wouldn't be a major surprise as Hurricane Ida idled plenty of production platforms in the Gulf of Mexico the previous week.

BoE Minutes Reveal Split On QE Vote

The minutes of the BoE's MPC meeting are out this morning, revealing a split in the voting for the move to raise QE by GBP25 billion to GBP200 billion.

The vote was 7-1-1, with seven members of the committee in favour of the increase, one in favour of leaving QE at GBP175 billion, and one wanting an increase to GBP215 billion.

"Most members thought that purchases totaling an additional GBP 25 billion would be appropriate given the balance of risks to inflation," the minutes said.

The pound had a mini-wobble on the news, but quickly settled down again, if two members had been in favour of increasing QE then it might have been different.

CBOT Closing Comments


January soybean futures closed at USD10.29 ½, up 19 ½ cents, December soymeal at USD308.70 up USD4.30 and December soy oil at 39.81 cents, up 4 points. Last week's export shipments were a marketing year high of 1,636,200 MT and inspections for this week are at 1,628,715 MT, underlying the fact that soybean demand remains very strong. Most of the business continues to come from China. Concerns remain over drought in parts of Argentina, with Oil World cutting its 2010 crop production estimate there by 2 MMT for the second month in a row to 48 MMT.


December corn futures closed at USD4.02, down ¼ cent, and March corn at USD4.17 ½, unchanged. Whilst demand seems to have slackened off the past few weeks, the USDA today announced a sale to Mexico of 209,983 MT for the 2009/10 marketing year and 77,364 MT for 2010/11 delivery. The US harvest is well behind schedule at just 54% completed as of Sunday, harvesting this week is expected make slower progress than the past 2 weeks with recurring showers on 3-4 days, according to Gail Martell of Martell Crop Projections.


December wheat futures finished the day at USD5.74 ¾, up 12 ½ cents. Large spec shorts have left themselves vulnerable to a correction in the wheat market that few had foreseen, with wheat prices having gained 30% since the first week of October. US SRW wheat plantings are expected to decline 15-20% this winter due to the delayed corn and soybean harvest and soggy soil conditions. The dollar is near the low end of the past 15 month trading range, that should make US wheat attractive to foreign buyers but it is not reflected in the export picture yet. Japan are expected to buy 71,000 MT of US wheat in a routine tender Thursday.

EU Wheat Closing Comments

EU wheat futures closed with November London feed wheat GBP0.10/tonne higher at GBP105.15/tonne and with Paris January milling wheat up EUR1.25/tonne at EUR134.75/tonne.

London wheat was down for most of the day but recovered late in the session after American futures moved higher, contrary to early calls.

Outside markets also helped EU futures move higher, as too did a continued lack of farmer interest in selling at current levels, much to the consternation of some participants.

Oil World said that world production of biodiesel will be boosted by 20% to 19.2 MMT in the 2010 calendar year.

The UK will shortly see the opening of the 1.2 MMT/per annum wheat requiring Ensus bioethanol refinery on Teesside. A similar sized refinery is also due to be opened early in the new year in Rotterdam by Spanish company Abengoa.

Ukraine remain an aggressive merchandiser, selling 100,000 MT of wheat to Bangladesh overnight. However, Ukraine's wheat stocks on Nov 1st were 11 MMT, down 4.75 MMT since Sep 1st, according to the state statistical office. Clearly they simply cannot go on exporting at this rate.

In the US winter wheat planting is still behind schedule at 90% completed. In the potential problem SRW states of Illinois, Indiana and Missouri emergence was only 45% (92% normally), 55% (90%) and 33% (72%) respectively. That potentially leaves the crop vulnerable to lower yields in 2010 from under-developed wheat going into winter dormancy.

In Illinois wheat planting was only 77% complete as of Sunday, compared to 98% normally. With the ideal final planting date for SRW already well passed, many farmers here are expected to take the so-called 'prevented planting' option on their crop insurance, rather than attempt to get a crop into the ground at this late stage.

Overall SRW wheat plantings in the US are expected to fall by up to 1.7 million acres this season, or 20%, because of the latest corn and soybean harvest on record, and the extremely soggy underfoot conditions.

Milk Link: Turnover Down But Profits Up

Milk Link have issued their first half 2009 trading update today, reporting a 2.5% fall in group turnover from GBP278 million to GBP271 million.

Despite that, profits before tax are up a whopping 250% to GBP4.9 million, from GBP1.4 million.

Milk Link say that this is due to "exceptional costs in relation to the disposal of its Staplemead creamery" in H1 2008.

But I think it's more likely to be down to their policy of insisting on having everything for free for the first six months of any contract.

Strangely, they never did get back to me on my request for free milk and cheese on a trial basis though.

eCBOT Close/Early Call

The overnight grains closed lower with beans down 3-6 cents, corn 4-5 cents lower and wheat 6-7 cents easier.

Crude oil is 20 cents lower at USD78.70/barrel, after jumping more than USD2.50 yesterday. The American Petroleum Institute will report on stock levels later in the afternoon.

Grains are also in consolidation mode in what looks like being another 'turnaround Tuesday' after last night's gains.

The USDA reported the corn harvest was 54% completed as of Sunday, which fell within trade expectations of 50 to 60 percent completion, but well below the five year average of 77% done.

The soybean harvest was 89% completed as of Sunday, which fell slightly below trade expectations of 90 to 92 percent completion, and the five year average of 96%.

Winter wheat plantings were at 90% completed, which is 5 percentage points behind the 5-year average. Arkansas wheat was only 52% planted (80% normally), Illinois 77% (98%) and Indiana 85% (98%).

Celeres report that Brazilian farmers have 61% of their soybean crop in the ground, better than the 55% normally at this point in time, with 18% of the new crop already sold.

Things don't look so promising in parts of Argentina, where a persistent drought has yet to be broken in the western grain belt. Oil World have dropped their production estimate by 2 MMT for the second month running, now pegging 2009/10 output at 48 MMT, fully 5 MMT below the USDA's estimate of only last week.

Bangladesh purchased 100,000 tonnes of Ukraine wheat overnight. Ukraine's wheat stocks stood at 11 MMT on Nov 1st, 20% down on last year, and at the rate they are exporting wheat they won't have enough to last them until new crop.

Japan are looking for 92,000 MT of wheat in their normal weekly tender, of which 71,000 MT is US origin.

Early calls for this afternoon's CBOT session: corn called 3 to 5 lower; soybeans called 4 to 6 lower; wheat called 6 to 8 lower.

EU Sunpellet Prices

Basis 29% profat in euros/tonne

Nov 118,00 fot
dec 118,00 fot
Jan 118,00 fot
Feb 116,00 fot
Mch 112,00
Apr 112,00
May 110,00
Jne 110,00

Supermarket Wars

Everybody's favourite time of year is fast approaching, and this year promises to be even more exciting than normal with Asda saying that we are in for "the most competitive Christmas of the decade".

Whoopee! I can hardly wait. Tesco claims it will save its customers more than GBP250 million in pre-Christmas offers, whilst Asda said it would save its customers a total of £150 million before the big day.

They don't disclose exactly how much of those 'savings' will be passed directly onto their suppliers, but my guess is all GBP400 million of it.

I'd settle for just being served by somebody normal, without any personal hygiene problems and who isn't dribbling into my shopping as they whisk it across the conveyor belt.

EU Rapemeal Prices

Basis FOB Lower Rhine/Hamburg in euros/tonne:

Nov 132,00 unch
Dec 132,00 unch
Jan 131,00 -1,00
Feb/Apr 130,00 -1,00
May/1st h Jly 124,00 -1,00
Aug/Oct 10 120,00 unch
Nov/Apr 11 129,00 -1,00

Dollar Still Looks Weak

The US dollar is off 15-month lows today, but its downtrend still looks intact after comments by Federal Reserve head Ben Bernanke last night reinforced the view that US interest rates would stay low for some time yet, and possibly longer than originally anticipated.

Bernanke sent out slightly conflicting messages, indicating that he was comfortable with the current value of the dollar, but also saying that the Fed will continue to monitor the currency markets "closely" and will maintain a policy to "help ensure that the dollar is strong".

He then went on to say "it’s not obvious to me in any case that there’s any large misalignment's currently in the US financial system."

Meanwhile a member of the BoE's MPC, Andrew Sentance, says that the UK isn't still in recession, contrary to what the ONS recently had to say.

Sentance is being quoted as saying that "the UK economy has moved on to a recovery track and growth has resumed in the second half of this year."

News just out shows that the Consumer Prices Index (CPI) climbed to 1.5% in October, up from 1.1% in September, that's the first rise since February.

Wheat Continues To Pour Out Of Ukraine

Grain continues to pour out of cash-strapped Ukraine with Nov 1st wheat reserves standing at a fraction over 11 MMT, over 20% down on year ago levels, and 4.75 MMT less than two months previously.

You don't have to be Pythagoras to figure out that at this rate they will run out long before next season's harvest begins.

Against a backdrop of political uncertainty, farmers and trading houses alike are keen to export anything that isn't nailed to the floor. Quickly.

There's an election coming up in January, and the favourite is former president, and staunchly pro the East, Viktor Yanukovich.

"My foreign policy priority will be the restoration of a fully-fledged partnership with Russia," said Yanukovich at his campaign launch.

Anyone sense trouble?

USDA Crop Progress


After the close of CBOT last night the USDA reported the corn harvest is 54% completed as of Sunday, which fell within trade expectations of 50 to 60 percent completion, but well below the five year average of 77% done. That is only up 17 points from last week's 37% done, and harvesting this week is expected make slower progress than the past 2 weeks with recurring showers on 3-4 days, according to Gail Martell of Martell Crop Projections. Northern states in particular continue to lag with progress in North Dakota just 8% complete. Major corn producing state of Illinois was only 52% done, compared with 95% normally at this time of year.


The USDA reported that winter wheat plantings at 90% completed, which is 5 percentage points behind the 5-year average. Emergence was reported at 77%, 10 percentage points behind the 5-year average. In the potential problem SRW states of Illinois, Indiana and Missouri emergence was only 45% (92% normally), 55% (90%) and 33% (72%) respectively. As of Sunday Arkansas wheat was only 52% planted (80% normally), Illinois 77% (98%), Indiana 85% (98%). More heavy rainfall this week will stall wheat planting in the Mid South, according to Martell Crop Projections. It is getting too late to get all the intended acres sown, moreover reduced yields can be expected on under-developed wheat, they add.


The USDA reported soybean harvest is 89% completed as of Sunday, which fell slightly below trade expectations of 90 to 92 percent completion, and the five year average of 96%. Illinois continues to lag with 10% of the crop still in the fields, normally harvesting is 99% complete at this juncture.

CBOT Closing Comments


January soybean futures finished at USD10.10, up 23 cents December soymeal futures finished at USD304.40, up USD3.30 December soy oil futures finished at 39.77 cents, up 116 points. A steep rises in crude oil futures and a sharply lower US dollar index lent support to futures. The USDA reported 59.845 million bushels of soybean were inspected for export for the previous week, which fell on the high end of trade estimates ranging 50 to 60 million bu. The NOPA October soy crush came in at 155.262 Mbu, fell well above trade estimates ranging 134.5 to 144 million bu.


December corn futures settled at USD4.02 ¼, up 11 ¾ cents. The US weather outlook remains unhelpful to an timely wrap-up of the harvest. A sharply weaker dollar was also helpful to US corn as was firmer crude oil, and spillover strength from soybeans and wheat. The USDA reported 21.937 million bushels of corn were inspected for export for the previous week, which fell below trade estimates ranging 27 to 33 million bu.


December wheat futures closed at $5.62 ¼, up 23 ¼ cents . A steep decline in the US dollar index and higher US stock markets during pit trading lent a supportive tone to futures. Earlier, the USDA reported 15.047 million bushels of wheat were inspected for export for the previous week, which fell within trade estimates ranging 14 to 18 million bu. Weather this past weekend slowed remaining winter wheat plantings, but soil moisture is seen to increase production outlook. Commodity funds bought an estimated 5,000 wheat contracts on the CBOT.

EU Wheat Closing Comments

EU wheat futures closed higher Monday with January Paris milling wheat up EUR1.50 at EUR133.50/tonne, and London May feed wheat ending up GBP1.05 at GBP112.50/tonne.

Wheat rose on firmer US markets and outside influences, with gold setting record highs and firmer crude oil and equities. A weak dollar capped some gains, but nevertheless EU wheat began the week on a positive note.

India have agreed some small deals to import wheat in containerised shipments, according to media reports. If these consignments pass through customs without too much difficulty, then we may see larger bulk imports follow, with wheat prices in India as high as USD350/tonne in the south.

Stringent local quality requirements may see shippers reluctant to put up offers of Black Sea wheat against any such enquiries, that may provide a window of opportunity for EU wheat.

The Baltic Dry Index - the benchmark guide to drybulk shipping rates around the world - was up again today, it's thirteenth day of straight increases. The index has now risen an astonishing 95% in less than two months, on the back of strong Chinese demand for iron ore and coal.

That potentially makes long-haul freight particularly troublesome, and may provide some further opportunities for EU wheat closer to home.

"The world is awash with wheat, we've got burdensome stocks, it's very difficult to be optimistic, and any rallies are a God-given selling opportunity," say the 'big' newswires, strangely quoting wheat buyers with boats to fill.

I sense a strange nervousness about the market at the moment. Is there anything 'they' aren't telling us, I wonder?

And another thing, why has something like the UK wheatfeed market (a direct competitor to wheat in EU feed rations) suddenly moved up GBP25.00/tonne in a fortnight?

I've got absolutely no idea, honest. Well honest-ish.

EU Soymeal/pels Shipping List

Brazils Argies ETL/Sailed ETA Destination

Prince of Tokyo 36000 26-Oct 17-Nov Amsterdam
Double Rejoice 10000 43000 1-Nov 19-Nov Rotterdam
Glorious Sakura 10000 44000 4-Nov 20-Nov Rotterdam
Crimson Mercury 25000hp 1-Nov 20-Nov Amsterdam
Lucky Sunday 20000+hp 7-Nov 22-Nov Amsterdam
Sea Prince 42000 1-Nov 22-Nov Amsterdam
Growth Ring 10000 39000 9-Nov 25-Nov Rotterdam
Double Prosperity 43000 4-Nov 25-Nov Rotterdam
Cielo di Savona 22000 7-Nov 29-Nov Ghent
Forestal Esperanza 20000+hp 15-Nov 3-Dec Amsterdam
Grain Harvester 34000+hp 16-Nov 3-Dec Amsterdam
Mary Georgia 43000hp 15-Nov 4-Dec Rotterdam
United Challenger 40000+hp 16-Nov 4-Dec Amsterdam
Dyna Voyager 40000 16-Nov 5-Dec Amsterdam
Silver Pegasus 20000 18-Nov 9-Dec Rotterdam
Globulus 30000 22-Nov 9-Dec Rotterdam
Malaspina Castle 15000hp 20-Nov 9-Dec Amsterdam
Eden Maru 19000 30-Nov 22-Dec Rotterdam
Lucija 9000 30-Nov 22-Dec Rotterdam

EU Soymeal/Soypellet Prices

Basis USD/tonne
Brazil pellets 48% CIF Rotterdam/Amsterdam

Afloat 434,00
Nov 432,00
Dec 432,00
Jan/March 398,00
May/Sep 344,00

Argentine pellets 44/45% CIF Rotterdam/Amsterdam

Spot Fob 420,00
Dec 422,00
Jan/March 400,00
May/Sep 334,00

Dutch Hipro 49% FOB Rotterdam/Amsterdam

Dec 447,00
Jan 436,00
Feb/Apr 420,00
May/Jul 361,00
May/Oct 364,00

Argentine Hipro 49% CIF Rotterdam/Amsterdam

Afloat 443,00-439,00
Nov 437,00
Dec 436,00
Jan/March 414,00
May/Sep 349,00

eCBOT Close, Early Call

The overnight grains closed firmer with beans around 8-9 cents firmer, with corn up around 6 cents and wheat 7 cents higher.

The dollar is lower (again), and crude oil a little higher. Ethanol futures have also posted decent gains recently.

Wheat is gaining from ideas that there will be more interest from the US feed sector as corn prices remain steady.

The USDA will report tonight on the corn and soybean harvest and wheat planting progress.

The NOPA October soybean crush came in comfortably higher than expected at 155.3 million bushels, up 45% from September and 8% from a year ago.

El Nino seems to be delivering the promised rainfall for South America, in all but western and southern parts of the Argentine grain belt. Rain now is probably too late to be anything but a hindrance to wheat, but should aid early corn and soybeans.

It could be a case of there's already too much rain in parts of Brazil.

"Brazil farms have received at least one inch of rainfall in the past week, but locally more in Rio Grande do Sul, Goias and eastern Mato Grosso. There are no seriously dry areas in soybeans. In fact, excessive wetness may become a problem in Rio Grande do Sul with heavy rain again this week," says Gail Martell of Martell Crop Projections.

China's CNGOIC says that the country will import a record high 42.9 MMT of soybeans in the 2009 calendar year, that's 15% more than in 2008.

Early calls for this afternoon's CBOT opening: corn called 4 to 6 higher; soybeans called 6 to 10 higher; wheat called 6 to 7 higher.

Baltic Dry Index Almost Doubles In Less Than Two Months

The Baltic Dry Index - the benchmark guide to drybulk shipping rates on 40 routes across the world - is up 2.8% at 4230 today, it's thirteenth day of straight increases.

The index has now risen an astonishing 95% in less than two months, from a low of just 2163 set as recently as September 24th. We are still however, a very long way from the index's all-time high of 11,793 set in May 2008.

Strong Chinese demand for iron ore and coal, growing port congestion in China and Australia and tight ship availability have helped drive a rally in recent days.

While iron ore has been the primary driver of the index’s growth, coal is expected to kick in during the coming weeks as China and east Asia faces up to an unseasonably early winter with most of northern China reporting temperatures in minus territory for much of the last week. Free heating in China’s northern regions started yesterday.

Arla To Build World's Largest Milk Bottling Plant Near London

Arla has announced ambitious plans to build the world's largest milk bottling plant, capable of producing one billion litres of milk per annum. If it goes ahead the plant, on the outskirts of London, will be fully operational by 2012, it says:

Milky, milky

Pope Attacks Greed Of Speculators In Cereals Market

As a UN summit on food security opens in Rome, the Pope himself has thrown his funny little hat into the ring, attacking the 'greed' of speculators in the cereals market.

Food should not "be treated just like any other commodity," he said.

Full story here

The pontiff is believed to have recently shorted six cargoes of wheatfeed into Ireland.

Hot Gossip From The Bristol Dinner

There was plenty of hot gossip doing the rounds at Thursday's Bristol Dinner I bet, but unfortunately I wasn't there so I don't know any of it.

Cranswick Announces H1 Results

Premium sausages are proving lucrative for food manufacturer Cranswick, which released its interim results today saying turnover from continuing operations was up 19% at GBP355.6 million, while pre-tax profits were up 22% to GBP21.3 million.

Waitrose Announces New Grain Sourcing Deal For It's Pig Farmers

Premium supermarket chain Waitrose has announced a new initiative aimed at reducing the carbon footprint of it's pork.

The deal aims to source wheat and barley from within a fifty mile radius of the mill used to manufacture it's pig feed, and ties together producer BQP, processor Dalehead Foods, feed compounder BOCM Pauls and grain merchant Openfield.

I'll wait and see if I get a luxury hamper through in the post first, before I try and find any flaws in that eco-warrior story.

US In A Flap Over Chicken Wing Shortage

The credit crunch has led to a growth in cheap and cheerful sports bar dining in the US, sending demand for chicken wings soaring (nice pun), at a time when US chicken production is falling for the first time in 36 years.

Hence the US has got itself into a flap (thank you) over a shortage of chicken wings, and is being forced to create the boneless wing to satisfy consumer demand. I kid you not.

The story continues to get even stranger with the revelation that in the US chicken wings are now dearer than boneless chicken breasts. Pullet the other one? No siree, I'll layer you ten to one on I'm telling the truth:

I'd take the breasts all day long

EU Rapemeal Prices

Basis FOB Lower Rhine/Hamburg in euros/tonne:

Nov 132,00
Dec 132,00
Jan 132,00
Feb/Apr 131,00
May/1st h Jly 125,00
Aug/Oct 10 120,00
Nov/Apr 11 130,00

India To Import Wheat

Flour millers in the south of India have agreed deals to import mostly Australian prime wheat at levels around USD270-300/tonne according to media reports. This will be the first time India has imported wheat since the 2006/07 season when 6.7 MMT was shipped into the country.

News stories suggest that around 10,000 MT of wheat has been bought in containers, but if the goods get through stringent Indian customs regulations OK, the it could open the door for larger scale bulk imports.

Local prices have risen above the equivalent of USD300/tonne in the north, and USD330-350/tonne in the south. Meanwhile millers are conscious that bulk imports could be made at significantly lower levels, especially in the south of the country.

In late October the government said it had finally agreed to set the minimum tender price for wheat from it's reserves at Rs 1,379.70 - Rs 1,728.23/100kg (USD292-USD365/tonne). The lower price is for wheat in the northern and western breadbasket, whilst the higher price is for wheat delivered to the south of the country.

Millers in the south are keen to 'test the water' with quality control officials via some small containerised imports, before considering some larger bulk purchases whilst global prices remain so heavily discounted.

Whilst Black Sea wheat is currently quoted around USD230-235 a tonne C&F into Asia, international shippers have been quoting around a USD25/tonne 'risk' premium for Indian destinations.

Due to the tight customs regulations, Black Sea origin wheat might still be seen as too risky an option, which may potentially open the door for some EU wheat.

CBOT Closing Comments Friday


November soybean futures closed at 9.84, up 1 ¾ cents, and December soymeal futures at 301.10, up 10 cents. Export sales were very strong at 1,272,518 MT, well above trade estimates. China was once again the main buyer, booking 961,200 MT. Export shipments were a marketing year high of 1,636,200 MT with China being the main destination taking 1,130,000 MT.


December corn futures ended at 3.90 ½, unchanged. Export sales of 488,463 MT were so so and on the low end of trade guesses. Export shipments of 758,000 MT were not too bad, above the past four week average. Monday will see the USDA report on the latest harvest progress, it will be interesting to see how far corn has advanced from last week's miserly 37% complete, well below the five year average of 82% done.


December wheat futures ended at $5.39, up 7 ¼ cents. Export sales were on the higher end of trade guesses at 412,150 MT and 45% higher than last week. Shipments were up 58% at 456,500 MT from last week. All eyes will be on the USDA's planting progress report Monday night. Last week SRW seedings were of most concern in Illinois (63% vs 96% normally), Indiana (73% vs 96%) and Missouri (38% vs 80%).

EU Wheat Closing Comments Friday

EU wheat futures closed mixed Friday with January Paris milling up EUR0.25 at EUR132.00/tonne, and London May feed wheat down GBP0.55 at GBP111.45/tonne.

EU wheat was under pressure from a strong euro and sterling, or was it just a weak dollar?

The trade seemed to accept Egypt buying 295,000 MT of wheat off the Russians Thursday as almost inevitable. A bit like England losing to Brazil, you pretty much know it's going to happen, but a small optimistic part of you thinks that you might get a look in.

At least EU wheat was partially successful in Egypt's previous tender, US wheat hasn't got a look in for more than two months.

In the UK the long-awaited firing up of the Ensus bioethanol plant on Teesside seems to be finally nearing, with a trial run over the Christmas period leading to some sort of decent running schedule commecing in January. At least that's the story I am hearing.

That's particularly significant since Defra's recent estimate of a UK exportable surplus of just over 2 MMT in 2009/10 inexplicably took no account whatsoever for any usage from the bioethanol sector at all.

Well done Defra, reliable as ever.