Weekend Musings
The fertiliser market is going up on the back of India being short to the tune of a million tonnes, amongst other things, is what many of the newswires are saying.
Meanwhile wheat plantings in India are currently running in line with year ago levels at 21.7 million ha, the Indian government told us on Friday. What they forgot to mention though was that the wheat crop is normally almost fully planted by now. The five year average at this time of year is 27.1 million ha. The total average wheat area planted over the last three seasons has been 28 million ha.
Winter wheat only has a relatively short growing season in India, with plantings in November/December and harvesting March/April. A combination of a late planted crop, a lack of fertiliser and the worst summer monsoon season since 1972 makes India very much one to keep an eye on over the next few months. They are, after all, the second largest consumer of wheat in the world, the summer drought has cut rice production from 99 MMT last year to 81 MMT this time round, which some see as being likely to increase wheat demand further in 2010.
In short, these boys badly need to bring in a decent crop this season. With an estimated 60% of the country's farmland non-irrigated, they depend heavily on Mother Nature to lend a hand. Just recently she hasn't been overly cooperative:
That's a map of Indian rainfall for the week to Dec 5th with the main wheat growing area shaded in white. Virtually the entire country only received trace amounts of rainfall during that period, and things haven't gone much better since.
The government were supposed to have 25 MMT of wheat in store as at December 1st, and have steadfastly thus far been ignoring millers' appeals to release stocks onto the open market.
Maybe they're going to need it.
CBOT Closing Comments
Soybeans
January soybean futures closed at USD10.35, up 8 cents; December soymeal futures at USD314.50, up USD1.40; December soy oil futures at 39.22 cents, up 0.13 points. Demand remains robust for US soybeans ahead of harvesting in South America. Private exporters report sales of 232,000 MT soybeans to China Friday, and the US has shipped a record 9.6 MMT to China so far this year. Dec and Jan imports could be 4-4.5 MMT each, analysts say. El Nino related rains appear to have arrived just in time for plantings in Argentina, but if anything there is already too much rain in Southern Brazil.
Corn
December corn futures closed at USD3.89 ¼, up 12 cents, and March corn futures at USD4.04 ½, up 11 ½ cents. In the US 12% of the crop was still in the fields as of last Sunday. It is not expected that the harvest will have moved on greatly this week as heavy snow, sleet, rain and strong winds have all battered what's left standing. Taiwan purchased 60,000 tonnes of US corn overnight. Corn planting in Argentina is 80% done, sowings are seen sharply lower at 1.875 million hectares according to the Buenos Aires Grain Exchange, as farmers there jump on the soybean bandwagon. That's around 600,000 ha or 24% down on last year.
Wheat
December CBOT wheat futures closed at USD5.19 ¼, up 1 ½ cents; December KCBT wheat futures at USD5.17 ¼, up 2 ¼ cents; December MGEX wheat futures at USD5.27 ½, down 2 ½ cents. The USDA this week raised world production and lower consumption, leaving us with a 2.6 MMT increase in world ending stocks to 190.9 MMT. "After several years of tight world wheat supplies, stocks are rebuilding on the back of consecutive bumper harvests," they said. The harvest in Argentina is around a quarter done, with final production generally seen at around 7-7.5 MMT, the lowest since the late 1960's.
EU Wheat Closing Comments
EU wheat closed generally with only small changes at the end of a very uninspiring week. March Paris milling wheat ended up EUR0.75 at EUR131.00/tonne, and London May feed wheat finished down GBP0.25 at GBP110.00/tonne.
Little more than a hundred lots traded all day in London.
US wheat continues to slide, with December CBOT wheat falling 17 ½ cents on the week, as Russia and Ukraine continue to market their grain aggressively, picking up the lion's share of any export interest around.
The EU has granted export licences for 7.5 MMT of soft wheat so far this marketing year (July 1st to Dec 8th), that's almost 28% down on the 10.4 MMT approved for export this time last year.
The USDA this week raised world production by 2 MMT to 673.86 MMT. Global consumption was also reduced by around 1.6 MMT, mainly in the US, the EU and surprisingly India. That leaves us with a 2.6 MMT increase in world ending stocks to 190.9 MMT.
That puts the world stocks to usage ratio at 29.5%, its highest since 2001/02, and equivalent to more than 3 1/2 months supply. In the US the stocks:usage is highest in at least the last twenty years.
On a brighter note, Ensus is gearing up to start production sometime this month, reportedly taking in around 5,000 MT of wheat on Tuesday alone. They expect to be in full production early in 2010, when the plant will use 3,000 MT of wheat a day.
eCBOT Close, Early Call
The overnight grains were firmer, with beans around 10 cents higher, corn around 3-4 cents higher and wheat up 5.
The outside markets are all slightly friendly. The dollar is down a tad, crude oil up a little after briefly dipping below USD70/barrel yesterday and stocks and gold also a bit firmer.
It is not expected that the US corn harvest has moved on greatly this week from the 88% done last Sunday, as heavy snow, sleet, rain and strong winds all batter what's left in the fields.
In South America the outlook is for heavy to excessive rains across Southern Brazil today (centered on Sao Paulo) and now, substantial and important rains for Argentina over the next seven days to two weeks, say QT Weather. Increasing and persistent rainfall across Argentina will be particularly important, as corn and beans are still being sown (corn 80% complete, beans 71%).
The Argy rains will come too late to help the wheat crop, that's already around a quarter harvested, if anything these rains will harm not help what is only expected to amount to a crop of around 7-7.3 MMT this year.
Delivery intentions are picking up for corn despite the weather at 1,052 contracts, whilst for wheat they are falling away at 505 contracts.
Yesterday's USDA stocks numbers still weigh as being a little bit higher than anticipated for beans, corn and wheat.
Taiwan purchased 60,000 tonnes of US corn overnight.
China 'only' imported 2.89 MMT of soybeans in November, that seems less than I'd have thought, although Dec and Jan imports could be 4-4.5 MMT each.
Indian wheat plantings are only in line with last season's pace at 21.7 million hectares, despite an early start and government urgings to increase production.
Early calls for this afternoon's CBOT session: corn called 2 to 4 higher; soybeans called 8 to 10 higher; wheat called 3 to 5 higher.
Who's Next to Go Bust?
I'll have a tenner on Ukraine please. To win.
A report in the FT suggests that they've asked the IMF for a further USD2 billion emergency loan. It's already had USD11 billion from the IMF, but they suspended the release of any more cash in October after Ukraine failed to keep promises to get it's house in order.
One of the measures required was an increase in the heavily subsidised domestic gas prices, but with an election looming in January the government is caught between a rock and a hard place.
This is one reason I think that grain exports have been running at record levels this marketing year. The warning signs are there for all to see, "quick, whatever we've got to sell, let's sell it now for whatever we can get."
The implications for the agricultural sector are potentially very serious. Inputs in 2010 could plummet for one, a combination of a bad winter and a lack of inputs could lead to a sharply reduced harvest next year.
And the agricultural sector has been the only one in the Ukraine seeing any growth in 2009, what happens if that goes down the tubes too?
On a different note, what happens when they don't pay the gas bill? Anyone getting deja vu?
French Truckers And Milk Producers Threaten Strike Action
We all know that the French love a good strike, almost as much as their fondness for illegally handling the ball. Well it seems that they fancy a bit of time off over Christmas so their truckers' five main unions are threatening an indefinite walkout starting this weekend, unless employers organisations agree to increased pay demands.
The unhappy dairy sector have now decided that they might like to join forces with the truckers. So French milk producers are suggesting that they might also strike (again) in an effort to cause maximum disruption over the festive period.
If you're planning whisking your nearest & dearest off to Gay Paris for a romantic spot of Christmas sightseeing, you might also like to think again. Museums, theatres, libraries and other major landmarks have all hit by workers striking over staff cuts too.
The Musée d'Orsay, the Arc de Triomphe, Notre Dame, the Louvre, the Château de Versailles and the Pompidou Centre all had to close their doors to the public last week.
EU Wheat Export Licences Running 28 Pct Down
The EU has granted export licences for 7.5 MMT of soft wheat so far this marketing year (July 1st to Dec 8th), that's almost 28% down on the 10.4 MMT approved for export this time last year.
Total grain exports are even further behind (down 40%) at 9.3 MMT versus 15.6 MMT a year ago.
Grain imports however are also unsurprisingly lower, down 27% to 4.5 MMT.
London Wheat Futures Surge
November 2010 London wheat futures surged by a record ten pence a tonne today (it's a record today as nothing else has traded - picky) to an eye-watering GBP113.00/tonne, reports somebody very bored with nothing better to do.
In what brokers are describing as a feeding frenzy, in which eleven lots have traded already and it's not even lunchtime, futures soared to their highest levels since yesterday.
"It's an impressive technical retracement of the one year fibonacci thingy," said one leading chartist.
"As soon as November was 5p up, it triggered a massive wave of computer-generated buying which propelled wheat a further 5p higher just like that," he added excitedly.
"Long term underlying bullish fundamentals could push this market all the way to GBP113.25 quite easily," he concluded.
Fertiliser: If You Don't Buy It Now You Won't Get It
I love this time of year, carol singers, tinsel on the tree, chestnuts roasting on an open fire, and the fertiliser market reports landing on the mat.
It make me smile, like hearing Mistletoe and Wine on the radio somehow Christmas isn't complete without panic in the fertiliser market.
It's a bit like running round the Marks & Spencers at 4.30pm on Christmas Eve, well you've got to go for a few beers with the lads first when you knock off at lunchtime haven't you?
Then suddenly it's well I wanted a black basque and matching suspender set, but that pair of Bridget Jones knickers and the one remaining winceyette dressing gown with the bunny rabbits on it will have to do. It doesn't matter what size it is, I don't care what the price is either, here's my card, just wrap it up luv.
Now I will be the first to admit that the recent price hike in the ferts market does not have the same look of the enormously large rodent that it did last year. Perhaps it's more of a small fluffy gerbil this time round.
Apparently the Indians are buying anything they can get their hands on, the Chinese are about to slap a large export tax on their stuff, Russia and Ukraine want to keep everything for themselves and loads of other production facilities have closed down.
Strong, compelling and convincing arguments them all. If they didn't sound so amazingly familiar. They must keep these in boxes along with the Christmas decorations I reckon.
"Ah, look what I've found it's the old Chinese tax excuse, I remember first making that one up at school in 1983. Bless. Let's put that one here, next to the Russian plant closures."
Supermarket Wars
Wm Morrison, Britain's fourth largest supermarket, has seen its share of Britain's grocery trade grow to a record high of 12.1% in the past three months, according to figures from analysts TNS Worldpanel.
Morrison's market share grew year-on year at twice the rate of the rest of the market, they say. It stood at 12.1% for the three months to 29 November against 11.7% in the same period last year.
However, Marc Bolland (didn't he used to be in T Rex?), its chief executive who has largely been credited with the supermarket chain's turnaround, has since stepped down to become the boss of Marks & Spencer. He's refused a company car as he had "a bit of an argument with a tree" in his last one apparently.
The USDA On Wheat
Amongst a plethora or revised world supply and demand data released yesterday, the USDA had this to say about the wheat market:
"After several years of tight world wheat supplies, stocks are rebuilding on the back of consecutive bumper harvests.
"A key different from other periods of world stock growth has been the dramatic build up in US stocks relative to stocks held by the traditional foreign exporters (Argentina, Australia, Canada and the EU). In just 5 years US stocks have expanded over 50% (8.5 MMT), while traditional foreign export stocks have fallen 30% (14 MMT). With US wheat priced out of many markets and with other exporters unwilling to incur the cost of holding stocks, US stocks have soared."
The report went on to say that the US is at a "competitive disadvantage" to other global exporters, citing freight and other logistical advantages.
Overall they raised world production by 2 MMT to 673.86 MMT. The main adjustments coming from an increase of 2.5 MMT in Canada to 26.5 MMT, and a 1 MMT decrease in Australia to 22.5 MMT.
Argie production was left unchanged at a probably too high 8 MMT, Chinese output was also left unchanged at a questionable 114.5 MMT. EU-27 production was tweaked slightly higher to 138.34 MMT.
Global consumption was also reduced by around 1.6 MMT, mainly in the US, the EU and surprisingly India. That leaves us with a 2.6 MMT increase in world ending stocks to 190.9 MMT.
That puts the world stocks to usage ratio at 29.5%, its highest since 2001/02, and equivalent to more than 3 1/2 months supply. In the US the stocks:usage is highest in at least the last twenty years. Blimey, and only two years ago we were running out of the stuff!
Amazingly The Chinese Are Still At It
The official Chinese state news agency Xinhua are reporting that police have arrested three people in the northwestern Shaanxi province on suspicion of selling milk powder tainted with melamine.
Obviously the death penalty isn't enough of a deterrent for some people.
That's hardly going to help boost already low public confidence in the domestic dairy industry is it? Still, New Zealand exporters like Fonterra won't be complaining about that, they'll be milking it for all it's worth.
Major Russian Port Sees Grain Shipments Up 68 Pct
The major Russian Black Sea port of Novorossiysk reports that it shipped 7.56 MMT of grains during Jan-Oct this year, a 68% increase on shipments during the same period in 2008.
In total a massive 71.9 million tonnes of cargo was shipped from Novorossiysk during the first ten months of the year, 3.8 million tonnes more than in 2008.
Fertliser shipments were also up sharply, by 20.4% during the same period.
CBOT Closing Comments
Soybeans
January soybean futures finished at USD10.27, down 1 ½ cents, December soymeal futures at USD313.10, down 1.10 points and December soyoil futures at 39.09 cents, up 0.19 points, USDA increased 2009/10 exports by 15 million bushels, cutting ending stocks to 255 million bushels. A larger cut had been anticipated given the pace of recent exports to China. Weekly export sales of 927,700 MT were a little above expectations, whilst shipments of of 2,067,300 MT were up 59 percent from the previous week, with almost 1.5 MMT heading to China.
Corn
December corn futures closed at USD3.77 ¼, up 9 ¼ cents, March corn futures finished at USD3.93, up 9 ½ cents. Corn exports were cut by 50 million bushels and that was added to ending stocks in this morning's monthly USDA Supply Demand report. That gave us ending stocks of 1.675 million bushels, against expectations of 1.650 million bu. Weekly export sales however were robust at 847,700 MT. US weather does not look conducive to getting much of the remaining corn crop into the barn this side of Christmas.
Wheat
December CBOT wheat futures closed at USD5.17 ¾, up 2 ¾ cents, December KCBT wheat futures at USD5.15, down ½ cent and December MGEX wheat futures at USD5.30, down 1 ¼ cents. The monthly USDA Supply/Demand report out this morning showed a slight increase in ending stocks to 900 million bushels. That was a bit more than the trade had been hoping for, weekly export sales of 245,200 MT were also a tad disappointing. World ending stocks were also raised to 190.91 MMT.
EU Wheat Shows Little Change
Liffe/Euronext close: London wheat +GBP0.10 at GBP105.15, Paris wheat +EUR0.25 at EUR128.00, Paris rapeseed -EUR0.75 at EUR280.25, Paris corn -EUR0.50 at EUR131.50.
EU wheat futures closed with very little change Thursday, in another low-volume session.
At the risk of repeating myself, the market has definitely gone to sleep ahead of Christmas, and there seems like little likelihood of any significant price movements now until the New Year.
On a positive note, it looks like the long-awaited opening of the Ensus refinery is now imminent. Once operational, the facility will produce around one-third of the UK's total bioethanol requirements, and consume in excess of 1 MMT of wheat per annum.
A similar sized plant is expected to open early in 2010 in Rotterdam, before another UK facility opens in Hull sometime in the second half of next year.
That should help take up some of the EU over-supply, but not by any means all of it.
Winter wheat prospects seem to be developing well across much of Europe, with increased production in the UK, France and Germany on the cards for next year unless the weather throws up any problems.
Things aren't quite so promising in the Black Sea, with large parts of western Ukraine and the Volga region of Russia suffering from inadequate moisture at the moment.
The USDA today raised it's estimate for US 2009/10 ending stocks to 900 million bushels, more than the 875 million the trade had been expecting. Weekly export sales were also disappointing at 245,200 MT.
Rotterdam/Amsterdam Soy Arrivals
Brazil pell. Arg. Pell ETA/ETD Destination
----------------------------------------------------------------
United Challenger 40000+hp 11-14 Dec etd Amsterdam
Grain Harvester 34000+hp 10-11 Dec etd Amsterdam
Silver Pegasus 20000 10-12 Dec etd Rotterdam
Globulus 6000 30000 10-14 Dec etd Amsterdam
Malaspina Castle 15000hp 14-15 Dec etd Amsterdam
Dyna Voyager 40000 15-Dec Amsterdam
Aquitania 40000+hp 21-Dec Amsterdam
Selinda 25000 20-Dec Amsterdam
Hamburg 35000+hp 22-Dec Amsterdam
Eden Maru 10000 49000 21-Dec Rotterdam
Agios Makarios 15000+hp 23-Dec Amsterdam
Lucija 19000 24-Dec Rotterdam
Hokuetsu Ace 8000 25000 31-Dec Amsterdam
Glorious Sakura 6000 38000 10-Jan Amsterdam
Sea Prince 41000+hp 10-Jan Amsterdam
Global Explorer 30000 13-Jan Rotterdam
Ariso 15000 40000 14-Jan Amsterdam
Sendai Spirit 6000hp 15-Jan Amsterdam
Forestal Pacific 25000 18-Jan Amsterdam
Rotterdam Trader 25000+hp 20-Jan Rotterdam
Cristal Pioneer 15000+hp 20-Jan Amsterdam
Crimson Mercury 35000 21-Jan Rotterdam
USDA 2009/10 Ending Stocks, Early Call
The USDA today pegged the 2009/10 soybean carryout at 255 million bushels, slightly higher than trade expectations of 235 million. They obviously haven't been looking at their own weekly export sales to China recently.
Corn ending stocks were forecast at 1.675 million bushels, against expectations of 1.650 million bu., and wheat carryout pegged at 900 million bu. compared to forecasts of 875 million bu.
So all three came in above trade expectations. That has to be bearish, although the weekly export sales were supportive for beans and corn.
Corn may also garner support from the fact that 12% of the crop is still out there sitting in the snow!
Wheat looks the most bearish of the three, coupled with the poor export sales.
Early calls from the CBOT floor - corn flat to 2 lower, beans 1-2 higher, wheat down 1-2 cents.
I'll take wheat to end much lower than that.
USDA Weekly Export Sales/Shipments
In it's regular weekly statement for the period November 27-December 3 the USDA report the following:
Soybeans
Net sales of 927,700 MT were up 41 percent from the previous week, and right at the upper end of expectations for sales of 600-900,000 MT. Once again China took the lion's share at 613,700 MT. The Netherlands (130,400 MT), Japan (113,300 MT), Indonesia (72,400 MT(, Germany (65,100 MT) and Egypt (47,500 MT) were also buyers.
Shipments of of 2,067,300 MT were up 59 percent from the previous week, with almost 1.5 MMT heading to China.
Corn
Net sales of 847,700 MT were up 29 percent from the previous week and towards the upper end of expectations of 450-900,000 MT. Japan (271,000 MT), Cuba (122,800 MT), Mexico (103,600 MT), South Korea (91,700 MT), Colombia (72,000 MT), Syria (55,000 MT), and the Dominican Republic (39,800 MT) were featured buyers.
Exports of 706,500 MT were down 20 percent from the previous week. The primary destinations were Japan (188,700 MT), Mexico (183,900 MT) and South Korea (173,200 MT).
Wheat
Net sales of 245,200 MT were down 37 percent from the previous week and below expectations of 300-500,000 MT. The main buyers were Nigeria (98,300 MT) and Japan (57,900 MT).
Exports of 306,600 MT were down 20 percent from the previous week. The primary destinations were Nigeria (54,000 MT), Taiwan (50,100 MT), Japan (44,000 MT), the Dominican Republic (32,700 MT), Canada (26,000 MT) and Mexico (24,900 MT).
BoE Leaves Rates/QE On Hold
As widely expected the Bank of England's Monetary Policy Committee today left UK interest rates on hold at 0.5%, and made no addition to the GBP200 billion asset-purchase program.
We won't know until the minutes of the meeting are released later this month, if any of the MPC wanted to add to last month's GBP25 billion increase in QE.
The pound is flat just under 1.63 against the dollar and around 1.1050 against the euro.
China Execute Rogue Trader
No siree, they certainly don't muck about in China. One teeny weeny little bit of rogue trading and that's it. Well, USD9.5 million worth of rogue trading actually:
Reuters
Hurry Up Ensus
Christ, it's like hanging around waiting for a gig to start. Just press the bloody button, it'll be all right. Don't worry about that banging noise, they always do that when they're new, it's just erm bedding in. Smell? What smell? I can't smell anything burning. Nah, it'll be fine, can you make it go a bit well...faster? A lot faster, actually. We've got all this wheat to get shot of you see and there's fields full of more of the bloody stuff out there, just sitting there, growing. Looking at us and pulling funny faces. It wasn't our fault, we didn't want to plant it, the voices made us do it. What happens if I turn this dial up to where it says "DANGER"? What are all them alarm bells for? Can you build another one?
Nogger's Thoughts On Climate Change
As world leaders and their entourages head off to Copenhagen to discuss climate change, the first thing I'd like to know is how are they getting there?
Yes, they're going by plane, and not just one plane either, loads of planes from all around the world will be belching out their exhaust fumes on the tarmac in Copenhagen.
That's going to help isn't it?
Some 'experts' say we should eat less meat, that will sort the job out. We'll have fewer cows and pigs farting away, destroying the precious ozone layer that we've worked so hard to protect.
If the Polar ice caps are melting, send them for counselling. Get ACAS involved, they'll be able to spin the whole thing out for years no problem.
If we're going to be basking in 80 degree sunshine every summer, then I won't need to go abroad will I? That should help my carbon footprint. And if the tide's come in a little bit further than normal, than I won't have to walk so far when I fancy a little dip either will I? More energy saved.
Keep me well away from cabbage, sprouts and baked beans for safety reasons, you can just see the hole in the ozone layer getting smaller as I type.
Feed me lots of good quality meat, from local farms and I'm a happy bunny. Danish bacon, no thanks, keep it in Denmark. More energy saved.
Here's a radical idea, let's walk to the local shops for our groceries every day. Let's buy fresh local produce from Peter the butcher, and Sally the fruit & veg girl. Or do you actually like getting pushed and shoved round Adsa, sending all your money to Wal Mart Towers. Buying strawberries that have been flown in from Kenya to go with your Christmas dinner, then finding that somebody has removed the wing mirror of you car with their shopping trolley whilst you were gone?
EU Rapemeal Prices
Basis FOB Hamburg/Lower Rhine in euros/tonne:
Dec 146,00 -2,00
Jan 140,00 -2,00
Feb/Apr 131,00 -2,00
May/1st h Jly 117,00 unch
Aug/Oct 10 113,00 -2,00
Nov/Jan 11 120,00 -3,00
Nov/Apr 11 121,00 -4,00
CBOT Closing Comments
Soybeans
January Soybeans closed at USD10.28 1/2, down 15 1/2 cents, December soybean Meal at USD314.20, down USD2.40, and December soybean oil at USD38.90, down 1.21 points. Trade estimates for tomorrow’s weekly export sales report range from 600,000 to 900,000 MT. Brazil's IBGE pegs the 2009-10 soybean crop at 64.9 MMT, Conab say 64.5 MMT. both estimates are well above last season's output of 57.1 MMT. The crop is 85% planted say Celeres. The USDA supply/demand report will be out Thursday, analysts estimate US soybean ending stocks at 235 million bushels, down from 270 million in the last report.
Corn
December Corn Futures closed at USD3.68, down 1 1/2 cents, and March corn futures at USD3.83 1/2, down 1 1/2 cents. Estimates range from 450,000 to 900,000 MT for tomorrow’s weekly export sales report. Analysts are estimating 2009/10 corn ending stocks at 1.646 billion bushels for Thursday's USDA supply/demand report, up from 1.625 billion bushels in November. Weak outside markets also limited gains.
Wheat
December CBOT Wheat closed at USD5.15 down 4 1/4 cents, December KCBT Wheat at USD5.15 1/2, down 1/2 cent, and December MGEX Wheat at USD5.31 1/4, down 2 1/2 cents. Trade guesses for all wheat ending stocks range from 937 to 800 million bushels with an average guess of 887 million bushels. Export sales estimates range between 300,000 and 500,000 MT for tomorrow’s USDA weekly export sales report.
EU Wheat Ends Lower Again
EU wheat futures closed lower again Wednesday with January Paris milling wheat down EUR1.00 at EUR127.75/tonne, and London May feed wheat down GBP0.65 at GBP110.25/tonne.
The trade seems to have shut up shop until January, although futures are drifting lower.
Reports suggest that the Holy Grail Ensus refinery took in some 5,000 MT of wheat on Tuesday, and that this will somehow save the world, although I don't quite see it myself.
I'm naively looking at the market reports from Dow Jones tonight as if they will provide me with some inspiration. Sadly, but not surprisingly, they don't. You might as well ask a snake how to peel a banana.
I strongly suspect that come January we will be looking for buyers, and that Ensus apart, they may be few and far between.
eCBOT Close, Early Call
The overnight grains closed narrowly mixed with corn around 3 cents higher, beans 1-2 cents lower and wheat flat to one down.
Crude oil is a little firmer but off earlier highs at USD72.90/barrel. The American Petroleum Institute yesterday shocked the market my announcing an inventory fall of 5.8 million barrels last week, when the market had expected an increase of around half a million. The US Energy Dept will release their stocks numbers later today, something of the same magnitude increase as the API would boost crude and might help grains this afternoon.
The world has got the jitters after Greece and now Spain had their credit ratings/outlook downgraded this week, following on from the Dubai problems recently. Moody's have indicated that both the UK and US might get a similarly embarrassing downgrading of their AAA status if they don't get their fingers out.
All that makes for a volatile forex market with the dollar, sterling and euro vying for the star prize in "Who Want's To Be a Pauper".
On the weather front, the intense early winter storm, now over Lake Michigan, has left enough snow across the Corn Belt to push harvest 2009 well into 2010, say QT Weather.
Damage will be widespread from this weather event, with only one of the concerns being the deep snowpack and drifts that linger over the yet to be harvested cornfield, they add.
Delivery intentions for wheat are 1,134 contracts, and 832 contracts for corn.
Reports continuing to come out of Australia suggest that a combination of frost, heavy rains, high winds and a prolonged period of 30+ C days have all taken their toll on wheat.
Tomorrow we have the USDA's supply & demand report and their weekly export sales to look forward to.
In the US soybean 2009/10 ending stocks are seen falling to 235 million bushels, down from 270 million in the last report. Corn ending stocks are seen at 1.646 billion bushels, up from 1.625 billion bushels in November. Wheat ending stocks are expected to show a small increase from 885 million bushels in November to 886.
The weekly export sales will be interesting too, particularly to see the size of China's purchases of soybeans this past week.
Early calls for this afternoon's CBOT session: corn called 2 to 3 higher; soybeans called 1 to 3 lower; wheat called mixed.
Let's Get Ready To Crumble
Well, that didn't take very long did it? In answer to my question who's going down with Greece, Standard & Poor have just revised the outlook on Spain to negative from stable.
Serves them right for clamping my hire car for no reason at all back in 2000 if you ask me. How am I supposed to read the signs if they're in Spanish?
That's 50% of the PIGS in the sh*t already this week and it's only Wednesday.
Right, who's next? The Irish haven't had much luck lately have they?
EU Rapemeal Prices
Basis FOB Hamburg/Lower Rhine in euros/tonne:
Dec 148,00
Jan 142,00
Feb/Apr 133,00
May/1st h Jly 117,00
Aug/Oct 10 115,00
Nov/Apr 11 125,00
Greece On The Slippery Slope, Who's Going Down With Them?
Fears over the solvency of Greece have reached new levels after Fitch downgraded the Mediterranean country's sovereign debt to BBB+, with a negative outlook.
Fellow ratings agency Standard & Poor's have also warned Greece that it may have its credit rating cut on worries over the government's ability to reign in its public finances.
This throws up a string of questions such as will Greece be looking to the rest of Europe to throw it a lifeline? And if so, how will Europe respond? And who else might get downgraded next?
Britain has already been warned that its AAA credit rating is not written in stone, but then again neither is that of the US.
Predicting likely future currency movements has never been easy, but surely has it ever been this hard?
Step forward our very own Knob in shining armour, Alistair Darling. I wouldn't trust him to fight his way out of a paper bag, but this afternoon he's going to tell us how he will halve our record budget deficit inside four years.
According to the Telegraph within that time frame almost 10p in every pound of tax paid by British families and companies will go straight towards interest payments on the national debt.
Next week Darling will unveil his plans to solve the Middle East problem, whilst immersed in a glass tank full of water, fifty feet up in the air in the middle of Hyde Park.
Please, No More, Be Still My Aching Sides
India's junior agriculture and food minister K.V. Thomas has told reporters that the government are "considering" lowering the minimum price in their recently announced wheat tender.
Offering half a million tonnes under the Open Market Sale Scheme (OMSS) at way over world market price, has surprisingly not met with an avalanche of buying interest from Indian millers.
Curiously just yesterday Food and Agriculture Minister, Sharad Pawar, ruled out lowering the prices of food grains under OMSS.
Crikey, and you thought our government was bad. I think that these boys just like seeing their names in the papers.
It's a bit like the old....
Monday: Rooney Leaving Utd Shocker
Tuesday: I'm Staying Put - Rooney
Wednesday: Why I Have To Go - Rooney Exclusive
Thursday: Roo Who? - Fergie
Friday: I Hate That Stinking Manc Cess Pit - Rooney
Saturday: Fregie Hails Rooney Hat Trick
Sunday: I've Always Been A Manc Me La - Rooney
China - A Stock Take I'd Love To Do
The deeply dark and mysterious China National Grain and Oils Information Centre, or CNGOIC, have left their Chinese crop production numbers unchanged in their monthly crop report.
Despite the fact that every other official body on the planet say that this season's corn crop was badly hit by drought, the CNGOIC don't see it that way.
As long ago as September Shanghai-based JC Intelligence flagged up that all was not quite right with the Chinese corn crop. Back then JCI said that the crop would drop by around 20 MMT to 146 MMT.
Even the blind leading the blind USDA subsequently trimmed their production estimate to an erring on the side of caution 155 MMT.
The CNGOIC steadfastly insist that this season's corn crop is 163 MMT, a whopping 17 MMT more than JCI forecast. They also maintain that wheat production in 2009 was a smidge under 115 MMT, although many other analysts think that this number is also far too high.
This is the problem with China, we're simply never going to know, transparency is not something they do. The only problem is that's where 40% of the entire world's corn and 32% of global wheat ending stocks are supposed to be!
With Chinese corn consumption running at 159 MMT/per annum and wheat at 102 MMT/pa there isn't exactly a lot of room to just drop the odd 17 MMT here & there.
CBOT Closing Comments
Soybeans
January soybean futures closed USD10.44, down 9 cents, December soymeal futures at USD316.60, down USD4.80, and December soy oil futures at 40.11 cents, down 0.20 points. Outside markets were a disappointment, with crude oil and gold sharply lower and the dollar higher. Brazil's IBGE pegs the 2009-10 soybean crop at 64.9 MMT, Conab say 64.5 MMT. both estimates are well above last season's output of 57.1 MMT. The crop is 85% planted say Celeres. The USDA supply/demand report will be out Thursday, analysts estimate US soybean ending stocks at 235 million bushels, down from 270 million in the last report.
Corn
December corn futures closed at USD3.69 ½, up ¾ cents and March corn futures at USD3.85, down 1 ¼ cents. Over 10% of the US corn crop is still in the fields, and a foot or more of snow on the way for large parts of the Midwest. Martell Crop Projections report that 90% of corn yield losses associated with delayed harvesting occurred after mid November when corn dries much slower. Analysts are estimating 2009/10 corn ending stocks at 1.646 billion bushels for Thursday's USDA supply/demand report, up from 1.625 billion bushels in November. Weak outside markets also limited gains.
Wheat
December CBOT wheat futures ended at USD5.19 ¼, down 7 ¼ cents, December KCBT wheat futures at USD5.20 ½, down 4 cents and December MGEX wheat futures at USD5.33 ¾, down 5 ½ cents. ABARE lowered it's estimate for the Australian wheat crop by 700,000 MT to 22.0 MMT. Japan is looking for 131,000 MT of wheat in a tender Thursday, most of which will be US origin. Wheat ending stocks on Thursday from the USDA are expected to show a modest increase from 885 million bushels in November to 886.
EU Wheat Ends Lower
EU wheat closes Tuesday with Jan London feed wheat GBP1.25 lower at GBP105.50/tonne, and Jan Paris milling wheat down EUR1.00 at EUR128.75/tonne.
By recent standards things were quite active with London wheat trading over 600 lots and more than 10,000 lots of Paris wheat changing hands.
Certainly much of the London business looks like it was probably the rolling over of positions from January into March.
For all the talk that there is no demand, my spies tell me that the A19 was full of merchant's wheat lorries en-route to Ensus today. It seems like somebody is going to be pressing the big red button fairly soon, maybe they've got Mylene Klass booked? There's a joke in there regarding the releasing of my balls, but I won't attempt to find it.
Farmers generally seem like they don't want to sell, at least not this side of the New Year. Are they doing the right thing? Only time will tell.
It is worth considering that every arable farmer in the country (including those in Devon & Kent) seem to be thinking that Ensus will emerge as a forced buyer, pushing the domestic wheat market higher.
Simultaneously, every compounder/dairy farmer in the land reckons that they will also become a forced seller of DDGS.
So they will end up paying through the nose for their raw material, whilst selling their by-product at a knock-down price.
It could happen, but I don't think so somehow, the latter is far, far, more likely to be true than the former in my humble opinion.
CBOT Opening
Early CBOT calls were modestly higher with corn called up 2 to 4 cents, soybeans called 3 to 6 higher, and wheat called 1 to 2 higher.
As it happened the grains are mixed in early trade, with beans and wheat around 5-6 cents lower, and corn posting modest gains of a cent or so.
With over 10% of the corn crop still in the field, and a foot of snow on the way for large parts of the Midwest, it's not hard to see why corn is the strongest leg this afternoon.
Brazil's IBGE pegs the 2009-10 soybean crop at 64.9 MMT, Conab say 64.5 MMT. both estimates are well above last season's output of 57.1 MMT. The crop is 85% planted say Celeres.
Brazil's 2009/10 wheat crop will be 5.0 MMT say Conab, that's 14% down on last season.
ABARE lowered it's estimate for the Australian wheat crop by 700,000 MT to 22.0 MMT.
Japan is looking for 131,000 MT of wheat in a tender Thursday, most of which will be US origin.
In Thursday's supply and demand report the USDA is expected to raise 09/10 corn ending stocks from 1.625 billion bushels in November to 1.646. Soybean ending stocks are expected to decrease from 270 million bushels in November to 235. Wheat ending stocks are expected to show a modest increase from 885 million bushels in November to 886.
The reality of the situation is probably that soybean ending stocks will be lower than expected, and wheat stocks higher. But will the super cautious USDA figures report that?
They've been picking up Chinese soybean orders for fun of late, and exports combined with sales are running at 27.81 MMT, as of last week. That's 77% of the USDA's target for the whole of 2009/10, and we are only 13 weeks (a quarter of the year) into it. And China have booked another five cargoes of beans that we know of since then!
Wheat sales have not proved so promising, the recent hike in freight rates might have something to do with that. In last week's wheat tender offers of US grain to Egypt were well above Black Sea and European levels.
World Rapeseed Production, Use, Stocks
Oil World say that that 7.0 MMT of rapeseed was crushed in the EU in the first four months of marketing year 2009/10 (July/June). That is an increase of 3% from the 6.8 MMT crushed in the same period of previous season.
World rapeseed production for 2009/10 is now seen at 59.5 MMT (previous forecast 58.3 MMT, previous year 58.2 MMT), after revising Canadian output up to 11.8 MMT (10.5; 12.6), they say.
Global use is expected to reach 59.7 MMT (59.4; 55.8), including a crush of 56.3 MMT (56.1; 51.8). Ending stocks are forecast at 6.7 MMT (5.9; 6.9).
French Nov 1st Grain Stocks Up Almost 25 Pct
Commercial French grain stocks on Nov 1st were up almost 25% on year ago levels to 25.6 MMT (from 18.6 MMT), according to government data.
Sort wheat stocks were 11.2 MMT (2008: 9.8 MMT), barley stocks 6.8 MMT (4.9 MMT) and corn stocks 5.9 MMT (2.6 MMT).
The figures also show that France exported 3.9 MMT of wheat (excluding durum) in the first three months of marketing year 2009/10 (July/June), down 5% compared to 4.1 MMT exported in the same period of the previous season. Of that total 1.6 MMT (1.8 MMT) went to other EU countries and 2.3 MMT (2.4 MMT) were exported outside the EU.
Barley exports were 1.2 MMT (2008: 1.3 MMT), almost all of which went inside the EU. Corn exports came in at 1.7 MMT (1.2 MMT), of which 1.6 MMT went inside the EU.
The top French wheat export home was Italy at 357,000 MT, Belgium took the most barley at 321,000 MT and Spain took the most corn at 564,000 MT. Corn exports to the UK were up sharply in the period to 113,000 MT fro 75,000 MT in 2008.
Germans Offer 780,000 MT Barley Into Intervention
German farmers have offered 780,000 MT of barley into the EU Intervention scheme since it opened on November 1st, according to German agricultural agency BLE.
The Germans obviously fancy around EUR102/tonne a lot more than their UK counterparts, who have only put up around 13,000 MT of barley for intervention so far - and the vast majority of that has been in Scotland including a storage contract.
The Germans alone are expected to put around 1.5 MMT into intervention this season, the problem with that of course is that it's got to come back onto the market at some point.
Ditto everything else being offered up by the French, the Danes, the Eastern Europeans and Uncle Tomaz Cobblski.
ABARE Cut Australian Wheat Estimate
The Australian Bureau of Agricultural & Resource Economics (ABARE) have lowered their 2009 winter wheat production estimate from 22.7 MMT to 22.0 MMT, broadly in line with other analyst's estimates which range around 21-22 MMT.
“Conditions deteriorated over spring in Western Australia, Queensland and, in particular, central west and southern New South Wales," say ABARE.
"Winter crop production in New South Wales has been revised down significantly from our earlier forecasts.
"Cropping regions in Western Australia were affected by lack of rain toward the end of spring and, as a result, production has been revised down from earlier expectations,” they add.
Barley production is estimated at around 8.3 million tonnes, up 8% from last season. Canola output is estimated at 1.8 million tonnes in 2009-10, which is around 5% lower than 2008-09 production.
Summer sorghum planted area is forecast to be around 637,000 hectares, 15.5% down compared with last season’s 754,000 ha.
Rice area is forecast to increase significantly in 2009-10, to 18,600 ha, compared with 8,000 ha in 2008-09. Cotton plantings are forecast to increase 24% to 203,000 ha.
USDA Harvest/Planting Progress
The USDA last night pegged the US corn crop at 88% harvested as of Sunday, only 9 points up on the 79% harvested a week ago. There is no five year average to compare that with, as the USDA reports have normally finished by early December.
Illinois features as a problem state at only 85% done, with progress in the Dakotas even worse - SD at 73% and ND at just 53%. Wisconsin (77%) is also one of the furthest behind, with only Texas and North Carolina 100% done.
Widespread snow and rain is in the forecast for this week, which will do little to help US farmers draw this crop to a conclusion. It would seem clear that some corn isn't going to get harvested this side of Christmas.
There were no figures given for winter wheat plantings, I think we have to assume that what isn't in now in the likes of Illinois isn't going to get in. Certainly if I were an Illinois farmer I'd be looking closely at the price of soybeans right now and planning to switch to them in the spring.
Winter wheat crop conditions were left completely unchanged from a week ago at 63% good/excellent, and the crop is 93% emerged - although again Illinois lags at 87% emerged compared with 100% normally. Missouri wheat is only 64% emerged, compared to 91% normally. With winter seemingly setting in fast, this late planting and subsequent delayed emergence could cause a few problems down the line.
CBOT Closing Comments
Soybeans
Soybean futures ended 6 ¾ to 11 ¼ cents higher. Soymeal futures ended 50 cents to $1.90 higher, while soyoil futures ended 54 to 59 points higher. Beans are quite clearly the strongest leg of the complex by some considerable distance. The USDA reported 58.28 million bushels of soybeans were inspect for export in the week ending December 3, which fell above trade estimates ranging 40 to 45 million bu. Five cargoes of soybeans were sold to the Chinese on Friday, and China is expected to possibly import a record amount of soybeans in December - close to 5 MMT. Despite the fact that we should be seeing harvest pressure at this time of year, that's a lot of bullish news.
Corn
Corn futures settled around 4-5 cents lower. The USDA reported 25.92 million bushels of corn were inspect for export for the week ending December 3, which fell towards the low end of trade estimates ranging 23 to 35 million bu. Outside influences also dragged corn down, with crude oil and gold sharply lower. Snow over the Corn Belt and forecaste again later this week will continue to delay harvesting. Funds sold an estimated 7,000 contracts today.
Wheat
Chicago SRW futures were down around 9-10 cents, KCBT HRW were down 11-12 cents, and MGEX spring wheat was down 8-9 cents. The USDA reported 12.98 million bushels of wheat were inspect for export the week ending December 3, which fell below trade estimates ranging 13 to 17 million bu. ABARE report tomorrow on their latest production estimates for Australian grains, a small downwards revision might be in order. The harvest in Argentina is 22% done and yields are poor, say the Ag Ministry, output this year is only seen at around 7 MMT, the lowest in more than 30 years.
EU Wheat Ends Slightly Lower
EU wheat futures continued to slide slightly lower in holiday season apathy Monday. Paris January milling wheat futures closed down EUR1.50 at EUR129.75/tonne, whilst London May feed wheat futures ended down GBP0.95 at GBP111.75/tonne.
It was another low volume trading session in London, with little more than 200 lots traded all day. Market participants have clearly packed up for Christmas already.
US wheat is trending lower, in the absence of any fund buying to support the market, and that is dragging EU wheat lower with it.
The Australian crop will likely be downsized when ABARE release their revised estimates tomorrow, and production prospects in Argentina are also looking wretched. Unfortunately it's the northern hemisphere that we are competing with.
There are still plentiful supplies out of the Black Sea, Ukraine exports are running ahead of last year's record pace and Russia are still the hot favourites to pick up any export enquiry going at the moment.
EU Soymeal/Pellet Prices
Basis CIF Rotterdam/Amsterdam in USD/tonne unless otherwise stated:
Brazil pellets 48% profat
Afloat 447,00-437,00
Dec 429,00
Jan/March 402,00
May/Sep 355,00
Argentine pellets 44/45% profat
Afloat 425,00
Dec 423,00
Jan/March 412,00
May/Sep 348,00
Dutch Hipro 49% profat
Dec 457,00 FOB
Jan 457,00 FOB
Feb/Apr 429,00 FOB
May/Jul 375,00 FOB
May/Oct 379,00 FOB
Argentine Hipro 49% profat
Afloat 452,00-440,00
Dec 434,00
Jan/March 420,00
May/Sep 361,00
EU Rapemeal Prices
Basis euros/tonne FOB ex Hamburg/Lower Rhine:
Dec 150,00
Jan 147,00
Feb/Apr 137,00
May/1st h Jly 121,00
Aug/Oct 10 119,00
Nov/Apr 11 127,00
eCBOT Close, Early Call
The overnight grains closed mixed, with beans around 6 cents higher, corn 2-3 cents lower and wheat around 4-5 cents easier.
Beans are still getting support from the Chinese influence, where futures set 2009 highs Monday on ideas that the government's recently announced support programme will underpin prices.
Reports that China may import more than June's record 4.71 MMT of soybeans in December, according to the CNGOIC is also supportive. The USDA confirmed the sale of five cargoes of US soybeans to China on Friday.
The September soybean contract settled 1.8% higher at CNY4,085 on China's Dalian Exchange.
The USDA will report tonight on harvest progress made during the past week. What US corn isn't in already might have to wait until after Christmas with what QT Weather are calling a “whopper of a snowstorm” set to cross the Plains, producing strong winds and heavy wet snow from Kansas to Michigan.
Outside markets aren't lending too much support, with crude oil weaker - below USD75/barrel - even gold is lower today, and Wall Street expected to open easier.
Bangladesh is tendering for 100,000 MT of wheat.
Early calls for this afternoon's CBOT opening: corn called 2 to 4 lower; soybeans called 4 to 6 higher; wheat called 4 to 6 lower.
Without fund support there doesn't seem like there's much around to stop wheat sliding to double digit losses today.
Things That Really Annoy Me #3
Being forced by Mrs Nogger to watch some Christmas No 1 programme on the telly on Saturday night, and now I can't get Shakin' Stevens out of my head.
It was quite amusing seeing Roy Wood attempting to get a cute little school girl to give him a peck on the cheek though. The look in her eyes said "I'm not kissing you you freak, I only said I'd do this so I could get the day off school."
The weird one in Mud was there too, the one who always used to wear women's clothes and looks like a dead ringer for my ex Mother-in-law, except more feminine.
Apparently the bookies don't take bets on Christmas No 1 anymore, as it's too much of a certainty to be whoever wins the X Factor. So in an attempt to still wring some cash out of us they are offering odds on the Christmas No 2 instead it seems.
The big daddy of Christmas cash-in's - Sir Cliff - is a tempting 50/1 if you fancy a nibble of his festive offering. Or perhaps George Michael, himself also no stranger to number two's, tickles your fancy at 12's?
The bizarre duet of Rolf Harris and Status Quo's Rick Parfitt might be worth a punt at 18's.
Christmas No 2
Grain Still Pouring Out Of Ukraine
Never knowingly undersold Ukraine's grain exports are ahead of even last year's record pace, with 11.72 MMT having been shipped out so far this marketing year (to Dec 3rd), say the Ag Ministry.
Wheat exports account for 6 MMT of that total, with barley at 3.6 MMT and corn at 2 MMT. Rapeseed exports are not included in that total, but account for a further 1.4 MMT of exports so far this season.
That puts the country well past halfway towards it's 20 MMT export target for 2009/10. What are they going to do when they hit that? Keep on exporting until the silos are empty and the bread queues start forming?
Boring Headline Of The Day
From Dow Jones: "India Wheat Futures Up 0.4% On Buying" - do they pay good money for stuff like this?
I want to write for Dow Jones and get paid loads of money, and I reckon I can do a better of it too....
"India Wheat Futures Soar 0.4% On Buying Frenzy"
(See, just insert the words Soar and Frenzy and already things are looking far more exciting. Follow that promising start up with....)
Indian wheat futures today soared 0.4% to their highest levels since yesterday's 0.2% decline on a wave of frenzied drug-fuelled panic buying.
(Right, now we've got the buyer interested let's reel him in....)
A gigantic, unprecedented tidal wave of interest, on a scale not witnessed since 1803 sent sellers scurrying for cover as investors speculated that the world is going to end tomorrow.
Female brokers ripped their trading jackets off screaming "take me, take me," their ample bosoms heaving, in a frenetic scene more reminiscent of Caligula The Movie, than the NCDEX trading floor.
"Are you familiar with the concept of the marmite sandwich?" one huskily breathless insider who refused to be named whispered provocatively in my ear.
My protestations fell on stoney ground as she pushed me to the trading floor, frantically ripping my trading jacket from my finely honed torso, whilst deftly reaching for the butter.....
That's what people want to read, sort yourselves out Dow Jones.
Morocco Back In Wheat Market
Black Sea grain exporters will be salivating at the news that Morocco will need to import around 1.5 MMT of wheat in the first half of 2010, according to the nation's grain agency. The government will cut a 135% import duty on wheat in January to facilitate imports, the agency said.
The tariff was imposed back in June in an attempt to support local farmers in the wake of a record domestic cereal harvest of over 10 MMT. Wheat accounted for 6.37 MMT of that, according to the USDA, a 70% increase on last season's 3.73 MMT. Domestic wheat consumption for 2009/10 is forecast at 7.65 MMT by the USDA.
Morning Markets, And Will The Real Gordon Brown Please Stand Up
The overnight grains are mostly higher, led by soybeans which are currently 10-12 cents higher (having been up 18-20 cents earlier in the session).
China's National Grain & Oils Information Centre say that the country may import even more soybeans this month than the 4.71 MMT record set in June. And there's only one place where that is going to come from, the US.
Last week's export sales of 722,550 MT bring sales for the marketing year so far to 27.81 MMT, 77% of the USDA's target for the whole of 2009/10, and we are only 13 weeks (a quarter of the year) into it.
The USDA will let us know after the close tonight how much corn still remains to be harvested in the US, my guess is around 8-10%.
ABARE report tomorrow on their latest production estimates for Australian grains, a small downwards revision might be in order.
After rising sharply on Friday on the back of an unexpected fall in US unemployment, the dollar is back under pressure today, which is also helping grains.
The pound is also weaker. After leaving Euroland interest rates unchanged at 1% last week, ECB President Trichet indicated in his accompanying speech that they may withdraw stimulus measures faster than many had expected.
No such fighting talk seems to be coming from Alistair Darling, you wouldn't be wanting to rely on that wet if things cut up a bit rough around the back of a nightclub at 2am would you? The caterpillar eyebrowed one is due to announce his latest cunning plan on how we are going to get out of this mess in in a pre-budget report on Wednesday.
The record GBP11.4 billion October deficit will be cut in half inside four years says Gordon Brown, all Darling now has to do is tell us how he's going to do it. Talking of Gordon Brown, I have a theory that he's not running the country at all. I reckon that Tony Blair is still in charge, he's who we see on the telly every night, he's simply put on a bit of weight and had a mild stroke. GB is probably locked up in a cupboard in just his pants and a vest, deep in the bowels of Downing Street somewhere.
You see if I'm not right, once Cameron gets in and goes looking for somewhere to keep his bike.
