Nogger's Blog

13/12/11 -- The overnight grains were mostly firmer with wheat up 3-5 cents, and corn & beans generally around 2-3 cents higher.

When the Globex market closed crude oil was up around half a dollar. Since then it's jumped to almost USD3 higher on unconfirmed reports that the Straits of Hormuz is to close for "routine" military training by Iran.

European jitters remain with the ratings agencies likely to show more urgency in downgrading any one of an assortment of eurozone countries than the individuals themselves have displayed at sorting out their debt problems.

I wonder how many downgrades there will be before they meet again in March?

Meanwhile we appear to be getting our first little South American weather scare of the season.

"Growing conditions have become increasingly stressful in southern South America the past 2-3 weeks with intense drying. The crop area affected by emerging drought includes Argentina’s eastern grain belt in Buenos Aires, Entre Rios and Santa Fe. La Nina is the suspected culprit. Also becoming too dry are Uruguay and Rio Grande do Sul in Brazil," said Martell Crop Projections yesterday.

Brazilian analysts AgRural have lowered their Brazilian soybean production estimate by half a million tonnes to 73.1 MMT, although that's still better than Conab's 71.3 MMT number released late last week.

China says that it imported 5.7 MMT of soybeans last month, almost 50% more than in October. Demand from there should be robust over the next 40 days in the run-up to the Lunar New Year celebrations on January 23rd.

Egypt has bought 180,000 MT of wheat from a combination of France, Russia and Argentina. US wheat remains too expensive to be even offered. However the large fund short in CBOT wheat should continue to offer support.

Revised pre-opening calls for this afternoon's CBOT session: wheat up 4-6 cents, corn up 2-4 cents, beans up 3-5 cents.