CBOT Closing Comments


The soy complex closed higher with May Soybeans at USD9.52, up 9 ½ cents; May Soybean Meal at USD270.90, up USD5.00/ton and May Soybean Oil at USD38.95, up 25 points. With the harvest in Argentina just getting going, dockers in the major exporting port of San Martin have timed their strike action well. News that the police have closed the main access road into the docks was supportive for US beans. Analyst estimates for Wednesday's planting intentions report average 78.55 million acres for soybeans, with a range of 77.43 to 79.50 acres. The USDA projected plantings at 77 million acres at their Outlook Forum in February. Stocks are expected to come in at 1.207 billion bushels.


Futures just about managed to close in positive territory with May ending at USD3.56 ¼, up 1 ¼ cents and December at USD3.85 ½, up ¾ cent. Analysts estimates for the planting intentions report peg US corn acreage at 88.94 million acres with a broad looking range of 87 to 90.15 million acres. The USDA projected sowings of 89 million acres at their Outlook Forum in February. Stocks are expected to come in at 7.505 billion bushels. "Strong warming and sunshine next week will encourage rapid drying in the Upper Midwest. Not much rainfall is in the forecast either, just a light showers on the weekend. With steadily warming temperatures in April, soggy fields may dry out in time for corn seeding May 1," says Gail Martell of Martell Crop Projections.


May CBOT Wheat closed at USD4.64 ¾, down 1 ¾ cents; May KCBT Wheat at USD4.75 ½, down 1 ¼ cents; May MGEX Wheat at USD4.97, down ¾ cent. Wheat futures finished around 18 cents down on the week, as the US continues to lose out on exports, setting fresh contract lows. Analysts estimates for the planting intentions report peg US all wheat acreage at 53.33 million acres with a range of 51.9 to 54.9 million acres. The average estimate represents a decrease of almost 10% on last year's 59.13 million acres. Stocks are expected to come in at 1.364 billion bushels. "A year-long drought in Western Canada threatens to reduce the 2010 spring wheat production in Alberta, which is Canada’s second largest wheat province behind Saskatchewan, growing roughly 38% of the nation's hard red spring wheat," says Gail Martell of Martell Crop Projections.

EU Wheat Closing Comments

EU wheat futures closed higher Friday with May London feed wheat ending up GBP1.40 at GBP97.40/tonne and May Paris milling wheat up EUR0.25 at EUR125.75/tonne.

Farmers remain reluctant sellers, and are bow starting to busy themselves on the land as the weather finally warms up.

Coceral pegged EU-27 soft wheat production only modestly higher for 2010 at 133.1 MMT, 1 MMT lower than Strategie Grains recent estimated.

UK output is seen at 15.7 MMT, up from 14.3 MMT in 2009, whilst French production is seen slightly lower than last season at 38.3 MMT with Germany seeing a crop broadly unchanged at 25.2 MMT.

Overall the numbers are perhaps a little lower than they might have been.

For the record, barley production is seen down around 5.5 MMT to 56.6 MMT, being overtaken by corn as the EU's second largest grain crop with output there seen at 57.5 MMT.

Whilst Chicago wheat was setting fresh contract lows in the US, there isn't maybe any need for EU futures to follow America's lead with prices here already competitive with the Black Sea.

This has been adequately highlighted by EU wheat sales to all sorts of unusual destinations in the past couple of weeks.

Maybe nine months of being in the driving seat has tired the Russians and Ukrainians out?

Coceral See Increased EU-27 Wheat Production In 2010

This is an edited version of what was originally posted around lunchtime on Friday. No I hadn't been drinking, at least not at that point. Coceral's original press release was subsequently re-issued with some slighly different numbers. Their original EU-27 wheat production figure of 135.5 MMT was incorrect. Numpties. Here we go with the ammended version....

Coceral say that the EU-27 will produce 133.1 MMT of soft wheat in 2010, up 1.8% on last season's 130.7 MMT. Their estimate is 1 MMT lower than the latest forecast from French analysts Strategie Grains.

Durum wheat production will come in at 7.8 MMT this year say Coceral, giving us an EU-27 all wheat output of 140.9 MMT, 1.7 MMT up on last year's 139.2 MMT.

Barley production will fall almost 9%, or 5.4 MMT to 56.6 MMT, they say. Meanwhile corn output will increase slightly to 57.5 MMT.

For the record they see UK wheat production at 15.7 MMT, which is around 300,000 MT less than Strategie Grains, although 1.4 MMT or almost 10% up on last year.

German wheat output is seen holding steady at 25.2 MMT, with French production falling slightly to 38.2 MMT. Spanish soft wheat output is seen rising a little over a million tonnes to 4.5 MMT, that may not be good news for UK exporters.

Bloody Frogs!

Drought, What Drought?

Chinese state radio has said that the ongoing drought in the south west of the country will only have "a very limited" impact on prices of staples such as grains and rice. Indeed, they said that they'd Googled for drought to see what all the fuss was about, but unfortunately Google appeared to be temporarily offline.

It's just a bit dry that's all

Pound Goosed - Soros

I was putting the bins out earlier and stopped for a chat with our local "refuse relocation operative" Frank, Frankie Soros is his name. He's a nice bloke Frank, always whistling he is, who frequently stops for a chat usually about next doors cat and what he'd like to do to it. Sometimes about those bloody scumbags at number 37 with their broken down Sierra and that big Alsatian.

Today however, Frank broached the altogether more complex and diverse issue of the pound. To his way of thinking a Greek deal incorporating coordinated bilateral loans from its euro zone partners, with IMF assistance waiting in the wings should it be required, should be sufficient to quell the recent euro weakness.

An interesting viewpoint Frankie, I ventured, but er watch that bag mate it's dripping, I helpfully observed.

Undeterred, Frankie continued to press home his point. Although the inclusion of the IMF might be seen by some tarnishing the credibility of eurozone unity, their involvement should provide some stability in the market and help stimulate fiscal reconstruction, he opined.

Indeed, given that the pound had only managed to claw it's way back up to 1.12 against the beleaguered single currency, merely back to a level at where we started 2010, Frankie ventured that a run on a vulnerable looking sterling was his next major concern.

What awaits the pound now in the run-up to an election against a backdrop of strikes and political gesticulation and back-stabbing, especially against a resurgent US dollar, he asked.

He went on to assert that this mornings break below the 1.4850 Fibonacci support level suggests an attempt to test the 1.4400 22nd April 2009 lows against the greenback. At least he said that was the way he has restructured his portfolio once the Far East opened in the early hours, before heading off to the local council depot for the 6am shift, and he strongly suggested that I should do the same.

Some interesting and valid viewpoints there from Frankie. Next week Frankie Soros - "the whistling binman" - will talk us through his key analysis of the USDA planting intentions and quarterly stocks data.

What's Trading?

With outright spot hipro soymeal in the UK tighter than a gnat's chuff, spot available Liverpool material traded three times yesterday at GBP317/tonne. Potential Humberside sellers at lower money failed to come up with any actual firm offers.

Next week is going to be tight, with the inevitable buyer who can't last through until April bound to surface. Currently, the first available position on soya that I know I can definitely get hold of is 6th April Liverpool and/or Humber.

Chicago might have closed lower, but I don't really see that making too much difference to the very nearby positions, and the pound is down against the dollar again this morning too.

Resale potentially available for most positions after that through to the summer months.

Talking of hen's teeth, looking for offers on EU wheat distillers in the north spot available too.

Some resale oddments kicking around that may be of interest: spot soya hulls Liverpool and Portbury, there are odd loads available and also spot citrus in Liverpool.

It's my birthday today, so I'm out and about for a large chunk of the day with fun-filled action packed frivolity ahead of me. First stop the local tip to dispose of the four tonnes of cardboard that my new toys came in, next Morrisons to get the beer in for tonight, after that it's Homebase, We live on the edge here in North Yorkshire. Shabba.

CBOT Closing Comments


May Soybeans closed at USD9.42 ½, down 17 ½ cents; May Soybean Meal at USD265.90, down USD5.00/ton; May Soybean Oil at USD38.70, down 38 points. Dollar strength and crude oil weakness were a major factor behind the decline. Weekly export sales were also disappointing at a combined total of 319,900 MT. Crush data was in line with expectations.


May Corn futures were at USD3.55, down 10 cents; December Corn futures at USD3.84 ¾, down 9 ¼ cents. Corn closed below the 2010 lows set in February. Weekly exports were in line with trade expectations at 606,800 MT for delivery in 2009/10 . Analysts are estimating U.S. corn stocks at 7.496 billion bushels for March 1st, the largest March stocks number since 1988.


May CBOT Wheat closed at USD4.66 ½, down 9 ½ cents; May KCBT Wheat at USD4.76 ¾, down 8 ½ cents; May MGEX Wheat at USD4.97 ¾, down 5 ½ cents. Weekly export sales were decent at a combined 519,200 MT, above expectations of 250-450,000 MT. However another day of a very assertive dollar, following on from news earlier in the week of EU wheat making inroads to SE Asia and South American destinations underlined just how expensive US wheat has become.

EU Wheat Closing Comments

May London wheat closed GBP0.55 easier at GBP96.00/tonne, and May Paris wheat ending EUR0.50 higher at EUR125.50/tonne.

Once again a weak pound and euro helped underpin the grain sector, and further volatility ahead looks likely as Greek uncertainties continue and a UK election nears.

Farmers don't much fancy the look of current levels, but consumers are also pretty happy to sit and wait. Growers seem largely content to busy themselves with the land, if they can get onto it that is.

The weather seems to have warmed up for the time being, even in the Ukraine where things have apparently gone from deep mid-winter to spring in a matter of days.

"So far it appears plenty of plants have survived the winter and it’s not necessarily bad as some sources have previously hinted," says Ukraine agronomist Mike Lee.

"As the land dries out over the next week we will be better able to get out on to the fields and see a clearer picture. There will be crop losses as is normal for this part of the world but it is just a matter of how much," he adds.

The IGC cut it's forecast for 2010/11 world wheat production by 1 MMT to 658 MMT.

In America, the USDA reported a decent set of weekly export numbers, which should help final sales for the current marketing year exceed USDA projections of 22.5 MMT.

CBOT Early Call

The overnight grains closed with wheat 1-2 cents higher, soybeans up around 2-4 cents and corn flat either side of unchanged.

The dollar is down tad for once, and crude oil a little higher, just managing to hold above USD80/barrel.

The USDA's weekly export sales were a bit better than expected for wheat, in line for corn and below what was anticipated for soybeans. There were "unknown" cancellations for old crop beans and also a Chinese cancellation on new crop too.

The Feb soybean crush was bang on in line with expectations at 153.8 million bushels.

The dockers strike in San Martin port Argentina appears to be ongoing.

We might see a bit of short covering this afternoon ahead of next week's plantings and stocks reports.

Early calls: corn called mixed; soybeans called 2 to 4 higher; wheat called 1 to 3 higher.

USDA Weekly Export Sales

For the period-March 12-18, 2010 the USDA report the following export sales:

Wheat sales of 371,200 metric tons for delivery in 2009/10 plus a further 148,000 MT for delivery in 2010/11 bring combined sales to 519,200 MT, above expectations of 250-450,000 MT. Actual exports of 453,000 MT were up 76 percent from the previous week.

Corn sales of 606,800 MT for delivery in 2009/10 were in line with expectations of sales of 550-750,000 MT. There were no new crop sales. Exports of 1,160,800 MT were up 22 percent from the previous week.

Soybean sales of 273,400 MT for delivery in 2009/10 and 46,500 MT for delivery in 2010/11 make a combined total of 319,900 MT, somewhat below expectations of 350-550,000 MT. China was missing from the list of buyers for both old and new crop. There were cancellations of 236,900 MT for "unknown" for 2009/10 and 65,000 MT of 2010/11 for China. Exports of 796,200 MT were down 13 percent from the previous week, China took 283,900 MT.

The numbers look a little friendly for wheat, neutral for corn and bearish for soybeans.

Acute Spot Soyameal Tightness

The acute tightness in nearby soymeal availability in the UK looks set to continue a while yet with GBP317/tonne traded for first half April ex Liverpool today. That's around GBP40/tonne higher than what was being offered at the beginning of the month.

A glance down the shippers price lists at the moment sees more POA's than actual firm prices, as spot demand remains strong and the supply pipeline acutely tight.

One of the problems is that many consumers appear to have put themselves in an underbought position, in anticipation of a glut of cheap soymeal flooding in from South America.

Despite record production there, a combination of lack of farmer selling and bottlenecks at the ports is currently delaying arrivals in Europe by up to a month.

Nearby afloat vessels carrying Argentine hipro soya to Europe are quoted at USD424/tonne CIF today, whereas vessels only currently loading are offered at around USD366/tonne.

The situation looks set to get worse as Argentine dock workers flex their muscles by threatening widespread strike action, as they frequently do just as the soy and corn harvests kick off.

Strike action has already begun at the Quebraco terminal in the Argentine port of San Martin about 500 km north of Buenos Aires, and there are concerns that more ports will follow suit. In addition discontented truckers and farmers are now also threatening to follow suit.

Big crops, big prices is an old saying in the grain trade, and it certainly looks like applying to the current soymeal situation. A glance down one shipper's list today shows straight April hipro soya on the Humber priced at just shy of GBP75/tonne more than July.

This situation certainly looks like it is likely to continue at least through April and the into May - where domestic consumers here have substantially less cover on.

There's also been some spillover effect into the rapemeal market, which was looking quite weak earlier in the month, but has subsequently driven nearby prices back up again. We've also seen a pick up in summer and next winter activity on rapemeal, which has been priced at 50% - or even less in some cases - of the price of soymeal of late. Traditionally that is very much towards the low end of where we would expect rapemeal prices to be in relation to soya.

The Sun Will Come Out Tomorrow

At least it will according to Alistair Darling, who sees growth climbing and borrowing declining markedly over the next few years. The government will only need to get the begging bowl out to the tune of GBP167 billion now this year, GBP11 billion less than was predicted in December. No wait, there's more, borrowing will be down to a mere GBP74 billion by 2014-15.

Despite 2010 growth only seen at 1-1.25%, things will look a whole lot rosier next year with growth of 3-3.5%, he says.

He doesn't give us a lot of detail as to exactly how he's going to pull these things off, he probably suspects that it won't actually be him or Labour actually doing any of the pulling. If he's out of a job by then, then there's always a career with the Magic Circle of course.

Indian Wheat Sizzles

A hot and dry finish to the growing season could be causing premature ripening and kernel shrivelling in key Indian wheat growing areas, according to Gail Martell of Martell Crop Projections.

Above normal temperatures have been the rule for more than a month, and rainfall has largely been absent this spring, says Gail.

A separate report here suggests that production in the Punjab, which accounts for around a quarter of Indian wheat output, could be cut by 20%.

Production in the western half of India's top wheat producing region of Uttar Pradesh, and neighbouring Madhya Pradesh also look like being affected. And things probably aren't looking too good over the border in Pakistan either. These two were expecting a crop of more than 100 MMT this year.

CBOT Closing Comments


May Soybeans closed at USD9.60, down 8 cents; May Soybean Meal at USD270.90, down USD0.10/ton, May Soybean Oil at USD39.08, down 46 points. The dollar was higher again, and crude oil weaker, which helped drive prices down. Estimates for tomorrow's USDA weekly export sales range from 350,000 to 550,000 MT.


May Corn futures ended at USD3.65, up 2 ¼ cents; December Corn futures closed at USD3.94, up 1 ½ cents. Trade estimates for the tomorrow's weekly export sales range from 550,000 to 750,000 MT. The US weather outlook seems to be improving rapidly, which will help corn plantings in the south and dry things up somewhat further north.


May CBOT Wheat closed at USD4.76, down ½ cent; May KCBT Wheat was at USD4.85 ¼, down ¼ cent; May MGEX Wheat closed at USD5.03 ¼, down 1 ½ cents. estimates for tomorrow's weekly export sales report range from 250,000 to 450,000 MT. The US will be conscious that they are losing out on wheat export orders left, right and centre to the kind of destinations that would be normally expected to be a stronghold.

Totally Random Thoughts

Mrs N#3 has gone to bed early, is she trying to tell me something? I don't know, but then again I wouldn't would I? So it's gone 11pm and I'm channel surfing on the telly and come across "The Top 50 Boy Band Hits Of All Time". Crikey.

Nowt else to do I think so I start watching it. Oh dear I am shocked at how many songs I know, and actually like!

As I sit there I think....he's inside, he's in Eastenders, he's in Corrie, what the hell is Simon Le Bon wearing, is that a girl, he choked on his own vomit, he choked on erm well we don't really know what he choked on but it probably wasn't pleasant.

I think I might order that Val Doonican jumper off eBay after all if they have it in my size....I wonder if the do matching slippers?

Oh no, they are starting to stretch the definition of "boy band" now, Bros have just been on, What next? Motorhead are technically a boy band I think you will find in a court of law. Culture Club? The Sex Pistols? The Manic Street Preachers, no no they are a Boyo Band.

EU Wheat Closing Comments

May London wheat closed down GBP0.35 at GBP96.55/tonne, with May Paris wheat EUR0.75 lower at EUR125.00/tonne.

A broadly weaker sterling and euro limited losses, but losses there were nevertheless. The pound was down following Alistair Darling's budget day speech, whilst the euro was under pressure after Portugal had it's credit rating cut.

News of a 50,000 MT consignment of UK feed wheat heading for the Philippines, on top of recent French wheat sales to all sorts of unusual locations might help to make a bit of a dent in carryover stocks.

German farmers have now placed 1.36 MMT of barley into intervention, with 96,000 MT MT entering the support program in the last fortnight, as growers continue to attempt to clear the decks and concentrate on new crop.

Unofficial reports coming out of Ukraine and Russia suggest that winterkill has been more of an issue this year than last.

The IGC are due out tomorrow with their latest prognosis on crop production, before the USDA report on planting intentions and quarterly ending stocks next week.

CBOT Early Call

The overnight grains closed lower with beans around 7-8c easier and wheat & corn 2-3c down.

Dollar strength is once again in evidence, with the greenback gaining against both the pound and euro again today.

The euro is under pressure after Portugal had it's credit rating downgraded, whilst the pound declined after Alistair Darling's budget speech appeared to be more of a political one than an economic one. No surprises there then.

Crude oil is weaker after the American Petroleum Institute surprisingly raised their stocks estimate by a hefty 7.5 million barrels yesterday, far more than had been expected.

The US weather outlook seems to be improving rapidly, which will help corn plantings in the south and dry things up somewhat further north.

Next week's planting intentions and quarterly stocks report is eagerly awaited.

Shipping delays from South America may continue to push a few spot enquires the way of the US. Argy dockworkers are reportedly striking at two terminals in the port of San Martin, one each apparently owned by Cargill and Bunge.

The ongoing drought in SW China is a threat to wheat, corn and rapeseed production there.

China yesterday raised their anticipated import requirement for soybeans for March to more than 4.5 MMT, that's 700,000 MT more than they imported in the same period 2009.

The US will be conscious that they are losing out on wheat export orders left, right and centre to the kind of destinations that would be normally expected to be a stronghold.

Early calls for this afternoon's CBOT session: corn called 1 to 3 lower; soybeans called 6 to 8 lower; wheat called 2 to 5 lower.

UK Wheat Sold To Philippines

Following hot on the heels of yesterday's news that EU wheat was making inroads into all sorts of exotic and unusual locations like Thailand, Peru and Venezuela comes reports today of UK wheat going to the Philippines.

Gleadell loaded 50,000 MT of feed wheat in Immingham last week bound for the SE Asian country, according to media reports.

It's interesting to see EU wheat getting a look in to some of these unusual homes, and also highlights just how much help we're getting from the ailing pound and euro at the moment.

It also indicates exactly how uncompetitive US wheat has become. Australian wheat would also traditionally feature to most of these markets, again the strength of the Ozzie dollar is obviously affecting their ability to make sales on their own relative doorstep.

Storm Brewing In China

Drought, deforestation (didn't he play Scottie in Star Trek?) and overgrazing are being blamed for severe sandstorms gripping the Chinese capital Beijing this week. See pictures here.

Meanwhile the severe drought, being described as a "once in a century" event, in China's southwest has worsened according to China's drought relief authorities.

Of the five provinces worst affected by the drought, the top two - Guizhou and Yunnan - are said to account for 9% of the national wheat area and 24% of the county's rapeseed area.

Corn is also widely grown in these areas, with plantings underway right now. The rainy season begins in Yunnan in May, with little in the way of drought relief expected before then.

Doubtless the Chinese WILL have another year of record crop production in 2010 despite all of this of course. Indeed the Ministry could probably tell you NOW exactly what they WILL harvest this year because they already have the numbers to hand. A nice steady 2% higher across the board, exactly the same as in previous years by a curious conincidence. Don't bother Googling for it as they've had them shut down for lying.

CBOT Closing Comments


May Soybeans closed at USD9.68, down just ½ cent; May Soybean Meal at USD271.90, up USD0.50/ton; May Soybean Oil ended at 39.54, down 18 points. Private exporters reported soybean sales of 120,000 MT for 2010/11 delivery. Celeres say that the Brazilian soybean harvest is 56% done, well ahead of the five year average pace of 41%. Mato Grosso in the north is 88% complete and Parana 62% done, with Rio Grande do Sul in the south just getting started at 6% harvested,


May Corn futures were at USD3.62 ¾, down 8 cents; December Corn futures at USD3.93 ¼, down 7 cents. Taiwan bought 60,000 MT of U.S. corn and South Korea bought 165,000 MT. The weather in the US is forecast to warm up considerably over the next fortnight, which may finally encourage some corn planting further north than the Delta region. Temperatures 12-16 degrees above normal are forecast in the west, ready to spread eastward for the first week of April, according to QT Weather.


May CBOT Wheat closed at USD4.76 ¾, down 9 ¾ cents; May KCBT Wheat at USD4.85, down 9 cents; May MGEX Wheat at USD5.05, down 6 ¼ cents. US wheat is basically too expensive to pick up too many surprise orders on the export front. Talk that France is getting on with sales to Brazil, Peru and Venezuela would appear to confirm this. Even so Monday's USDA export inspections were above anticipated levels, and seem to indicate that the US will meet, and probably exceed, export targets for 2009/10.

EU Wheat Closing Comments

EU wheat closed mixed, with London mostly higher and Paris lower. May London feed wheat ended up GBP0.45 at GBP96.90/tonne, May Paris milling wheat closed down EUR1 at EUR125.75/tonne.

A strong dollar helped prevent EU wheat from declining too much, although gains against both sterling and the euro were broadly similar.

Reports that French exporters are "clearing the decks" in anticipation of another bumper wheat harvest this summer may not entirely be a bad thing.

The French are apparently picking up sales to all sorts of exotic destinations like Peru, Venezuela, Thailand and Brazil according to various media reports.

That won't do any harm in the long run, and for EU wheat to be able to travel to such far flung exotic destinations indicates that, maybe, prices here can't and don't need to fall much lower than they are already.

If the cure for high prices is high prices, then maybe the cure for low prices is also low prices.

Don't get me wrong, I'm not coming all over massively bullish on wheat, but I think that maybe a modest period of price consolidation is in order.

CBOT Early Call

The overnight grains closed narrowly mixed, with beans 2-3 cents higher, corn up fractions and wheat down fractions.

The dollar is firmer once again and crude oil weaker.

Celeres say that the Brazilian soybean harvest is 56% done, well ahead of the five year average pace of 41%. Mato Grosso in the north is 88% complete and Parana 62% done, with Rio Grande do Sul in the south just getting started at 6% harvested,

Despite the harvest being ahead of schedule, sales are lagging at 36% sold versus the five year average of 50% sold. This would appear to confirm reports that Brazilian farmers are less than thrilled at the prospect of selling at below the cost of production.

The USDA confirm that 120,000 MT of soybeans for 2010/11 have been sold to unknown. Taiwan purchased 60,000 MT of US corn for May and South Korea bought 165,000 MT of either US or South American origin corn.

China's Ministry of Commerce says they will import 4.56 MMT of soybeans in March, up from their previous est of 3.9 MMT and 3.86 MMT in 2009.

US weather is forecast to warm up considerably over the next few weeks, with temperatures 12-16 degrees above normal in the west, ready to spread eastward for the first week of April, according to QT Weather. This will bring heat into the 70’s in the Dakotas, and 90’s in Texas spreading eastward, they say.

Early calls for this afternoon's CBOT session: Soybeans called 1-2 cents higher, corn and wheat flat to down 1.

Ukraine Rapeseed Conditions Worsen

The Ukraine Ministry of Agriculture say that 25.5 percent of winter rapeseed in the country is now rated as poor, up from 22.4 percent a week ago and 20.8 percent the week before that.

The crop area rated as good has declined from 36 percent to 33.4 percent.

Around 17.1% or 242,700 ha of winter rapeseed area will need to be resown, say the Ministry, although they don't say where the money is coming from to fund it.

My newest chum, Kiev-based agronomist Mike Lee, emailed me late last week to say that he was just back from a whistle-stop tour of the surrounding Kiev region and there was still "snow everywhere, between 5cm and 20cm deep. That in itself is not a problem but underneath the snow there appears to be a layer of solid ice."

"We had some periods of thaw and freeze in Jan and Feb and the melt water has pooled and permeated into the soil before re-freezing," he says.

Although it is currently still difficult to quantify crop losses due to the remaining snow cover "my gut feeling at this stage is that we will see higher than average levels of crop losses this year but not as high as 2003 when it jumped up to 25%," he suggests.

On a side note, he also informs me that the local media reports that the newly elected government has launched some new legislation which has "effectively blocked the range of pesticides allowed to be imported in to Ukraine, which could be a problem if it turns out to be true."

Are Brazil Next To 'Do An India'

Storing surplus grain in the outdoors, open to the elements until it rots whilst people go hungry all around is clearly THE big thing this year.

The Indians have set the ball rolling, now the fashion conscious Brazilian is keen to follow:

Soybean Sales Remain Slow In Brazil

I gather that a similar mood is prevailing across the border in Argentina too.

Let Them Eat Fish

Argy President Cristina Fernandez has had a bight idea. Rolls eyes, a woman with a bright idea, go on then what is it. More shoe shops on every street corner?

No, she's come up with a plan to sell discount haddock to the local populace in Buenos Aires as a fleet of trucks tour the capital emblazoned with the slogan "Now There's Fish For Everyone".

The famously carnivorous Argies are somewhat bemused, but faced with the soaring price of domestic beef, quite a few are reportedly tempted to give haddock a chance.

The "funny coloured" haddock comes in frozen brick-like slabs, I can see you licking your lips and reaching for the Rick Stein book already. Ice cold lager mixed with plain flour and a pinch of salt makes a very good beer batter I can tell you.

Despite the less than appetising description some reports suggest queues of "thousands" lining the streets to buy something they can at least afford.

Fernandez, keen to promote the idea, has visited one to make a purchase herself. I'm sure Nestor was chuffed to bits with his tea that night.

Can you smell fish?

Im gagging for it I am

UK Inflation Falls To 3 Percent

UK annual inflation fell to 3 percent in February, from 3.5 percent in January, and slightly lower than the 3.1 percent the market had been expecting.

The Bank of England said last month that “inflation is likely to remain significantly above the 2% target in the near term, reflecting the continuing impact of sterling’s depreciation and the restoration of the VAT rate to 17.5%."

"These factors should have only a temporary effect on inflation," they added, talking their own book.

The currency markets were relatively unmoved by this slightly better result, following last week's warnings of a double dip risk from MPC member Andrew Sentence, with the pound holding a little above USD1.50 for now.

Step into the limelight Alistair Darling. Our half albino, half caterpillar Chancellor will open up his magic handbag of tricks tomorrow. The pound could be in for a volatile day.

Who's putting their money with me on ruthless pre-election inaction? Doing not a lot really might put the pound back under a bit of pressure.

CBOT Closing Comments


May Soybeans closed at USD9.68 ½, up 6 ½ cents; Nov Soybeans at USD9.45 ½, up 3 ½ cents; May Soybean Meal at USD271.40, up USD1.20/tonne; May Soybean Oil at 39.72, up 42 points. The USDA's weekly export inspections report of 32.1 million bushels was above the upper end of trade estimates. Oil World said last week that US stocks were already "unusually thin" for the time of year, any further increase in shipping delays in South America could make US stocks uncomfortably thin. This would be especially so if we have another late planting season, as looks likely at the moment.


May Corn futures finished at USD3.70 ½, down 3 ½ cents; December Corn futures at USD4.17 ½, down 4 ¼ cents. The USDA's weekly export inspections report of 41.6 million bushels was also above the upper end of trade estimates. Ethanol finished slightly higher at $1.595/gal. Crude oil had been below USD80/barrel early in the day but managed to close at USD81.25/barrel by the finish.


May CBOT Wheat closed at USD4.86 ½, up 2 ½ cents; May KCBT Wheat at USD4.94, up 2 cents; May MGEX Wheat at USD5.11 ¼, up 2 cents. The USDA's weekly export inspections report of 18.8 million bushels was above the upper end of trade estimates. Kansas wheat is now 77% breaking dormancy, up from 60% last week, but still around 2 weeks behind schedule. The USDA estimate Kansas crop conditions are 64% good to excellent.

EU Wheat Closing Comments

It was a see saw kind of a day today, with the pound opening at something like USD1.4940 early doors before climbing back above the psychologically important USD1.50 mark to reach close to USD1.51 just before midnight.

EU wheat closed mostly a little firmer, with March London wheat ending unchanged at GBP94.55/tonne and May Paris wheat EUR0.50 higher at EUR126.75/tonne.

There's a little bit of optimism that the worst might be over for EU wheat, with prices here now pretty competitive, albeit aided by an ailing pound and euro, and some export interest coming to the surface.

Weather conditions in Eastern Europe look like they may have caused some damage to wheat crops, although it is still a little early to quantify any losses.

The word from Ukraine is that a couple of thaws earlier in the year, that were subsequently followed by a rapid plunge in temperatures, will have caused some fairly significant damage. Some spring replanting will have to take place here, if growers can afford the cost.

Unconfirmed reports, of new legislation from the recently elected government restricting pesticide imports into the country could also pose some problems, if they are accurate.

Big Week Ahead In The Currency Markets

Having dipped below the 1.50 mark against the dollar again this morning, the pound looks like it's in for another volatile week.

Monthly inflation figures are due to be published tomorrow, with analysts expecting the consumer prices index (CPI) to have eased back to 3.1% for February after hitting 3.5% in January.

The increase, up from 2.9% in December and a low of 1.1% last autumn, was driven in part because of the end of lower VAT.

The Bank of England's government-set target for inflation is 2%. The Bank say that they expect things to dip back to this kind of level later in the year.

If they don't the the BoE may ultimately have to consider raising rates in order to meet its target.

We have the budget to look forward to on Wednesday, where the caterpillar eyebrowed one will outline exactly how he's going to cut borrowing, and pay back some of what we already owe. Of course in the run up to an election he's got a bit of a tightrope walk to do.

Greece is finally likely to be told politely but firmly to "do one" by EU minsters meeting at their summit on Thursday/Friday, before getting straight onto their mobile phone to the IMF.

We can probably therefore expect both the pound and euro to come under pressure as the week progresses.

Pressed Apple Pulp

One of my chums has some pressed apple pulp that's so cheap he's almost giving it away. Delivered into the Norfolk/Suffolk area for just GBP7/tonne, yes seven pounds a tonne, it could go further afield at normal haulage differentials. Any takers, please let me know. info at nogger dot co dot uk.

For the uninitiated, why do I write my email address like that? Spam avoidance measures old boy.

The Truth Behind India's Wheat Stocks

Well, well, well, who'd have thought it eh? Just call me Sherlock and leave it at that.

An Indian TV reporter has stumbled across wheat in Punjab worth 15 crores (a crore is Indian for a bloody big number, 15 of them is around USD3.3 million), in what can only be described as a bit of a state. We're talking a not even fit for the cat kind of a state.

Agriculture Minister Sharad Pawar, nice lad that he is, has promised to look into it and said that he might even consider going to the extraordinary lengths of hiring a warehouse to put his wheat into in the future!

This is the same Sharad Pawar who only last week ruled out exports of government owned wheat, we can see why now because who'd want to pay good money for this?

Yes, I've got some pics for you, but I'm going to make you wait a bit longer yet.

And this is only the tip of the iceberg, or in this case the tip of an enormous pile of "cack" to use a technical term.

"Across the state, at different government warehouses, wheat grain worth 500 to 800 crores is rotting away," says the report. To save you reaching for the calculator that's USD110-175 million.

Of around 7.2 MMT of wheat in store in Punjab, that's around half of the country's buffer stocks, 6.5 MMT is being stored outside in conditions like this. I wonder what conditions the other half are being stored in? Exactly the same no doubt. That would mean that around 90% of India's 2009/10 ending wheat stocks potentially look like this:

Video Nasty

Other links: here and here