The Morning Rant

Posted by Nogger - a legend in his own mind at 10:26 | Categorized as

11/11/11 -- There seems to be a modest air of calm about the place this morning. The Italian senate is expected to vote through austerity measures paving the way for Berlusconi to resign.

Yields on Italian bonds are off their highs and yesterday's auction of one year bills saw healthy demand.

Greece has got a new PM, and reports that France's credit rating had been downgraded by Standard & Poor's have been put down to a "technical error" by the rating agency.

So all in all things are looking rosy. The overnight's see wheat and corn 4-5 cents firmer with beans up 9-10 cents. Even so, front month Nov beans are still around 45 cents lower on the week so far with corn down 5 cents and wheat 13 cents easier.

In amongst all the excitement of the week you may have missed news that Alabama's Jefferson County filed for bankruptcy protection in the largest municipal bankruptcy in US history.

Ukraine shared the honours with Russian wheat in yesterday's Egyptian tender, beating French wheat on price by around USD15/tonne when freight is factored in. Argentine wheat came in the cheapest of the lot at USD239/tonne FOB, but lost out due to freight differentials. Even so, the US should take note. US shipments are starting to lag behind the level needed to reach the USDA's target of 26 MMT of exports for 2011/12.

There are reports that feed wheat from Brazil is being shipped into the US, undercutting domestic corn prices there. US wheat and corn prices are clearly too high, tight ending stocks for the latter or not.

Jan12 London wheat is down a pound this morning in quiet early trade. Domestic demand from the feed sector is sluggish at best. That said, as mentioned earlier in the week, farmer interest in selling in the mid to low GBP140's is also restrained.

So we have an impasse, who is going to break first?