Nogger's Blog

16/09/11 -- Nov London wheat closed GBP0.50/tonne higher at GBP161.75/tonne with Jan up GBP0.75/tonne at GBP163.75/tonne. Nov Paris wheat rose EUR0.25/tonne to EUR197.00/tonne with Jan also rising EUR0.25/tonne to EUR197.00/tonne.

On the week as a whole Nov London wheat was down GBP6.75/tonne (or 4%) whilst Nov Paris wheat fell EUR9.75/tonne (or 4.7%). On the month so far we have London wheat falling GBP9.00/tonne (5.1%), with Paris down EUR14.25/tonne (6.7%).

There's no great logical reason that I can come up with as to why London feed wheat should have fallen less than it's Parisian milling wheat counterpart. Strategie Grains have after all just decreased the proportion of milling wheat in this year's European crop by 3.1 MMT.

Whilst we know that French wheat is expensive relative to that coming out of Russia, as underlined again in this week's Egyptian tender, there's plenty of competition around for UK feed wheat too.

Maybe it's because there's a higher proportion of milling wheat around in the UK this year thanks to the dry spring/summer, and/or the narrow differential between feed wheat and barley. Or maybe it's simply because of the lack of liquidity in the London market?

On the political front, eurozone finance ministers have now agreed to delay the decision on releasing Greece it's next tranche of bailout funding until October. US Treasury Secretary Timothy Geithner meanwhile has criticised Europe's lack of unison over the debt crisis. Pot, kettle Mr Geithner surely.