Monday Morning Roundup

After another couple of days of wall-to-wall sunshine and temperatures in the mid-20s Sunday saw widespread rain across the UK. With the prospect of more to come this week, UK wheat potential is looking a lot better than just a couple of weeks ago. With the pound still up around the 1.21 mark against the euro that should be sufficient to see London wheat grind a little lower this morning.

The National Australia Bank have cut their wheat production estimate there slightly for the coming season to 22.2 MMT from 22.6 MMT. Barley production will fall 11% to 7.2 MMT as growers shun the grain due to miserable prices. In contrast rapeseed output will increase 13% to 2.15 MMT, they say.

The high Australian dollar is hurting wheat exports which were down 23% to 1.1 MMT in April from 1.43 MMT in March. That's a decrease of 35% on April 2009.

The Chinese wheat harvest is underway say the Ministry of Agriculture, and production is expected to be "slightly higher" than last season they say, through their rose-tinted spectacles. Despite the worst drought in living memory in the south, and a hard winter and prolonged cold spell in the north Chinese wheat production always seems to miraculously pull through and show a slight increase year on year doesn't it?

Is the Egypt/Russia trade spat about to kick off again. One report I am reading this morning (here) says that the north African country has impounded more than 60,000 MT of Russian wheat "over what the local Phytosanitary Committee claims are poor quality standards" without giving too many specifics.

The euro resides at fresh four year lows against the dollar on concerns that Hungary will be the next in line to require multi-billions of loans from fellow Eurozone countries. “It’s clear that the economy is in a very grave situation. It’s not an exaggeration at all to talk about a default,” their PM is quoted as saying.

The US is set for a rather wet couple of weeks, with "the next 16-days are modeled to be extremely wet across many regions," according to QT Weather. That may hamper soybean plantings somewhat which may provide a bit of support. Excessive rains in Canada also warrant keeping a very close eye on as the optimum planting window for spring wheat and rapeseed is rapidly running out.

Algeria has exported it's first barley since the 60's over the weekend with a shipment of 11,000 MT to Tunisia, according to reports. More exports will follow, according to the state grain agency OAIC.