Nogger's Blog

Chicago Close

04/03/11 -- Soybeans: Mar 11 soybeans closed at USD14.07 3/4, up 2 1/4 cents; Mar 11 soybean meal closed at USD363.80, down USD3.00; Mar 11 soybean oil closed at 58.96, up 70 points. Beans traded both sides within a fairly wide trading range with early strength tied to China buying 120,000 MT of old crop, along with reports of the Argentine port workers strike spreading. Later in the session however weakness came from Informa Economics upping their estimates for South American soybean production this year by a combined 5.1 MMT. Brazil will produce a record 71.4 MMT and Argentina a second highest ever 52 MMT, they said.

Corn: Mar 11 corn closed at USD7.21 1/4, down 8 1/2 cents; Dec 11 corn closed at USD6.09 1/2, down 6 1/4 cents. Corn closed lower on profit-taking ahead of the weekend after setting a fresh 32-month high earlier in the day. Even so Mar corn was 9 1/4 cents higher on the week. Informa dropped it's Argentine corn production estimate by 1 MMT to 21 MMT, but increased it's Brazilian estimate by 2.8 MMT to 53.8 MMT. Overall however global production was decreased by 1.7 MMT, partly due to lower South African and Mexican production.

Wheat: Mar 11 CBOT wheat closed at USD8.00 1/2, up 10 cents; Mar 11 KCBT wheat ended at USD9.18, up 9 3/4 cents; Mar 11 MGEX wheat finished at USD9.53, up 6 1/2 cents. Wheat finished with with CBOT up around 24 cents on the week, with KCBT up 30 cents and MGEX up 37 cents. The US Midwest is too wet and the Plains are too dry. "The Midwest forecast is stormy and very wet, with heavy rain coming early next week to Illinois, Indiana, Ohio and Michigan. Kansas wheat continues to be starved for moisture, and may miss out on rain again next week," say Martell Crop Projections.

EU Wheat Declines Late In The Day

04/03/11 -- EU wheat futures closed mostly lower with Mar London wheat down GBP2.80 at GBP196.55/tonne, and new crop Nov falling GBP0.30 to GBP163.00/tonne. Paris wheat closed with Mar down EUR1.50 to EUR253.00/tonne and Nov EUR2.00 easier to EUR217.00/tonne.

On the week as a whole that leaves Mar London wheat down GBP8.45/tonne and Mar Paris wheat EUR9.75/tonne lower.

Wheat was higher earlier in the day but fell away in afternoon trade as Chicago grains came under pressure. That appears to have been due to rising crude oil, talk is that this is forcing spec money out of grains.

It could also be a feeling that a weekend is a long time in Libya and anything could be on the cards come Monday morning.

At home it's been a funny old week on the weather front with reasonably warm daytime temperatures and a few frosty nights under clear skies. A bit of sunshine and spring warmth certainly seems to be waking the crops up, with local fields that I see on a regular basis certainly having grown visibly in the past week.

Elsewhere "pretty good rain last week helped crops in France and Spain, although subsoil dryness is still a worry in France. Eastern Europe remains stuck in a cold pattern with snow predicted for the weekend in Poland," say Martell Crop Projections.

Whilst EU wheat exports are well ahead of last year, the pace has slowed dramatically since Christmas. Euro strength is one of the reasons behind this, with the single currency pushing through 1.40 against the dollar for the first time in almost four months today.

Worrying Signs

04/03/11 -- The warning signs have been there for some time as we near the end of what has been a long and extremely difficult winter for the livestock industry not just in the UK, but in Europe and worldwide too.

As the supermarkets continue to rack up obscene profits, whilst doing their best to hold back price increases - strictly and selflessly with the best interests of the housewife in mind you understand - livestock farmers are feeling more than their fair share of the pinch.

A report out yesterday from BPEX reveals that in the 12 weeks to 23 January 2011, British pig producers accumulated losses of GBP35 million. Yet in the same period the processing sector's profits are estimated at GBP100 million, and retailers raked in combined profits of GBP192 million from pork and pork product sales.

There are similarly depressing stories to be found across the beef and poultry sector too.

Unsurprisingly, against a backdrop like this, much of the trade gossip reaching my ears this week has been about cashflow getting squeezed hard.

Merchants and compounders, whilst fully sympathising with the farmers plight, are bemoaning how difficult it is now becoming to get the monthly feed bill settled.

Contagion is the buzz word at the moment, with all the goings on in North Africa and the Middle East, and there's certainly plenty of that in evidence in the feed industry at the moment too.

Cashflow down the line is now starting to slow up from what people are telling me.

Meanwhile after last week's wobble, wheat, corn and soybeans have not just stabilised in price but actually started moving back up again. The only problem is end users who want to buy anything are nigh on impossible to find.

If you don't believe me email me to let me know what you want to buy as I have resellers of just about everything.

The only volume trades I am currently hearing of involve longs being sold back to shippers unwinding their shipping programmes.

London wheat might be GBP200/tonne, but wheatfeed pellets are now around GBP50/tonne less than that because it's physical kit that needs a home, not a piece of paper being passed around by batty boys.

As the livestock boys bail out we also have the hurdle of increased short-term meat supplies to get over. Ultimately of course that will create a shortage, and a corresponding increase in price, but we aren't there yet.

For the feed industry that means a long quiet summer lies ahead methinks, it certainly looks like it's going to get worse before it gets better from where I am standing. Still, look on the bright side, if there's no demand for feed then at least your cashflow is going to improve! Every cloud and all that.

Right, now I've got that little lot off my chest it is now most definitely beer o'clock....

Early Call On Chicago

04/03/11 -- The overnights closed mixed, but mostly higher, with beans up 5-7c, corn up 3c to down 1c and wheat 6-9c firmer.

There's some talk that not all of Argentina's soybean crop is looking too great. There are also reports of quality and potential yield issues in Brazil due to incessant rains.

The USDA have confirmed a fresh sale of 120,000 MT of old crop beans to China today, indicating that they haven't switched their buying attention away to South America entirely.

There are question marks over the health of US wheat as it emerges from winter dormancy, meanwhile Russian and Ukraine wheat areas have been dry and bitterly cold of late.

There is also some talk of high US corn prices leading to more interest in wheat from the feed sector.

Japan has announced the purchase of 150,000 MT of Brazilian corn overnight, switching interest away from the US due to high prices.

NYMEX crude is up a dollar and a half. Reports suggest that Brazil is buying US ethanol.

Early calls for this afternoon's CBOT session: beans up 5-7c, corn flat to up 2c, wheat up 8-10c.

The Week So Far

04/03/11 -- Having finished a torrid week astonishingly almost unchanged last week, I thought I'd take a quick peek at where we are this week so far.

Including the latest overnight Globex market we currently see Mar CBOT wheat up 14c, Mar beans are up 42 1/2c and Mar corn is 18 1/4c higher. On our side of the water we currently see Mar London wheat down GBP2.15, Mar Paris wheat down EUR4 and May Paris rapeseed up EUR20.50 to be Europe's star performer of the week.

Those are all based on prices at 11am this morning compared to last Friday's close. It's interesting to note that despite the more sedate pace of this trading week, we've actually seen prices generally move by more overall than a week ago.

What the significance of any of that is I'm buggered of I know, but just knowing and sharing it makes me feel better.

Is it beer o'clock yet?

Cauliflower Cheese?

04/03/11 -- Lincolnshire cauliflower growers are cheesed off that the winter weather has knobbled not just the sugar beet harvest in the county. As much as 80-90% of the crop could be lost in some cases, I am hearing.

I hope that the roast potato, Yorkshire pudding and gravy harvest goes OK for them.

I wonder how many of these sugar beet and veg growers are going to be thinking, bollox to this malarkey with wheat at two hundred pounds a tonne and a nice hungry shiny new bioethanol refinery down the road?

Early Vibe

04/03/11 -- It's been a very quiet week, let's hope that demand picks up a little as we get into the month, although currently I don't hold out a great deal of hope. Domestically, end user interest in anything is very thin on the ground.

Japan has announced the purchase of 150,000 MT of Brazilian corn overnight. US corn it would seem has priced itself out of the equation at current two year highs.

The Halifax say that UK house prices fell by 0.9% last month, and are down 2.8% year on year. That's worse than analysts were expecting (0.4% and 2.5% respectively). That hardly strengthens the case for raising interest rates, which may give the pound a bit of a wobble this morning.

Striking workers at the under construction Vivergo bioethanol plant at Saltend returned to work yesterday after employees "unfairly" picked out for redundancy were reinstated, according to my sources.

EU soft wheat exports are running 16% ahead of last season at 13.8 MMT as of March 1st, although the pace has slowed considerably from earlier in the season - before Christmas we were 36% ahead of 2009/10 levels. Euro strength and dollar weakness has hit demand, so too has the ever-widening differential between EU and US wheat prices.

Argy workers are still on strike at two terminals in Rosario, although operations are continuing at other facilities in the port. Overall only around 16% of the nation's crushing capacity is affected according to Reuters.

Luxury handbag and silk scarf maker Hermes saw net income in 2010 rise 46% to EUR422m after the artist formerly known as Prince popped into one of their shops.

Rumoured to be considering a public floatation, Glencore announced tidy little profits of USD3.79 billion yesterday, up 40%. Ensus might want to mention that one next time they are haggling over the price of wheat!

Ukrainian customs procedures (lack of adequate bribes) are delaying importation of grain and sugar-beet seeds for the spring sowing campaign, say the Ukraine equivalent of the NFU. That may cut this year's grain harvest to around 40 MMT from early hopes of 45-47 MMT, they warn. They are Ukrainian though, so they're probably lying.

And finally a bloke with what has to be one of the strangest farm-related fetishes going has been at it again it would seem. He is from Devon, mind: Your sister is your mother, your uncle is you brother etc

Chicago Close

03/03/11 -- Soybeans: Mar 11 soybeans closed at USD14.05 1/2, up 18 1/4 cents; Mar 11 soybean Meal closed at USD366.80, up USD7.80; Mar 11 soybean oil closed at 58.26, down 1 point. There was little in the way of fresh news. The Brazilian harvest is late and there are port strikes in Argentina. Weekly export sales of 645,300 MT were better than expected. China may be considering lowering import duties on grains it would seem.

Corn: CBOT Mar corn rose 15 3/4c to USD7.29 3/4 a bushel, CBOT May corn was up 15 1/4c to USD7.36 3/4 a bushel. Export sales were above 1 MMT for the fifth week in a row. All the newswires are full of upside potential. The market appears to have very little perception of any downside risk at all, which is always a dangerous sign in my opinion.

Wheat: CBOT May wheat ended up 12 1/4c at USD8.23 1/2 a bushel; KCBT May rose 8 1/4c to USD9.18 1/4 and MGEX May gained 15c to USD9.46 1/2. Export sales were a bit flat at 650,900 MT, compared to expectations of 900 TMT to 1.2 MMT. Old crop sales were down actually 44% from the previous week.

EU Wheat Mixed But Mostly Higher

03/03/11 -- EU wheat closed lower mixed with Mar London wheat up GBP1.75 to GBP199.35/tonne and new crop Nov GBP2.30 higher at GBP163.30/tonne. Mar Paris wheat fell EUR2.50 to EUR254.50/tonne, with Nov rising EUR0.75 to EUR219.00/tonne.

Exactly how old crop feed wheat prices are rising whilst milling wheat levels are falling is beyond me. Just about every feed compounder in the UK is reporting slack demand for finished feed, and rising prices are hardly going to improve the situation any.

March Paris wheat expires next Thursday, which may account for some of the nearby weakness, although it hardly explains why May and August should also close lower.

"The futures market can do what it likes, it's not going to make any difference to (sluggish) physical demand one jot," said one trader today.

To perhaps emphasis that point, Brussels announced today that they'd issued soft wheat export licences for 244,000 MT this past week. That means that we've only hit our weekly requirement needed to hit the USDA's predicted 21.5 MMT total for the current marketing year in two of the past nine weeks.

US wheat was higher in afternoon trade on drought in the southern Plains and flooding in the north, lending some late support to EU markets.

Chicago Close

02/03/11 -- Soybeans: Mar 11 soybeans closed at USD13.87 1/4, up 19 3/4 cents; Mar 11 soybean Meal closed at USD359.00, up USD1.00; Mar 11 soybean oil closed at 58.27, up 120 points. Harvest delays in Brazil seem to be driving beans higher, although there are no reports yet of crop losses. China may becoming more relaxed about food price rises is another story doing the rounds, although personally I don't subscribe to either. Strike action in Argentina may be supportive short-term.

Corn: CBOT Mar corn fell 13 1/4c to USD7.14 a bushel, CBOT May corn was down 14c to USD7.21 1/2 a bushel. Funds sold an estimated hefty 16,000 contracts on the day, with prices approaching limit down at one stage. Unwinding of long corn short wheat spreads maybe did some damage. Weekly export sales from the USDA tomorrow are expected to be in the 1 MMT region for the fourth week in a row.

Wheat: CBOT May wheat rose 1c to USD8.11 1/4 a bushel; KCBT May fell 2c to USD9.10 and MGEX May was up 1c to USD9.40 1/2. The USDA confirmed the sale of 220,000 MT of US wheat to unknown, although trade talk suggests that this may have been the weekend business to Saudi Arabia. Japan is expected to buy US wheat tomorrow and South Korea are in the market.

EU Wheat Ends Mostly Lower

02/03/11 -- EU wheat closed lower with Mar London wheat down GBP2.25 to GBP197.60/tonne and new crop Nov GBP2.00 easier at GBP161.00/tonne. Mar Paris wheat fell EUR0.25 to EUR257.00/tonne, with Nov also EUR0.25 lower at EUR218.25/tonne.

London wheat was particularly disadvantaged by a stronger pound hitting fresh 13 month highs against the US dollar. UK feed wheat has done a good job of rationing demand for it, with March closing at the equivalent of EUR232.50/tonne, almost exactly the same price as Paris corn.

The HGCA say that the milder February weather has encouraged early spring growth with crops more advanced than last year. Disease levels are low, they add.

The mild weather also brings with it thoughts of turnout being not that far away. With feed prices where they are relative to the levels that livestock farmers are receiving for their finished products summertime demand looks like being sluggish at best.

Weather prospects for US wheat look better than they did, with some potentially decent rains in the 7 day forecast, although the crop there is far from out of the woods yet. The Chinese situation has improved dramatically over the past week.

The situation in Libya shows no signs of being resolved anytime soon, continuing to push up crude oil prices and pulling money out of the grains sector.

Early Call On Chicago

02/03/11 -- The overnight grains closed mixed with beans around 12-14c higher, corn up 2-4c and wheat mostly 2-5c weaker.

Rain in some of the parched US Plains and China was behind wheat's mini fall from grace. China's drought affected wheat area has now fallen to under 2 million hectares, according to latest reports. It was 7.5 million at the beginning of February.

NYMEX crude is a dollar higher, now over USD100/barrel whilst Brent is currently around USD115.50/barrel.

Beans are up on rain disruptions in Brazil. Oil World raised its Argy soybean production estimate to 48.5 MMT (up 0.5 MMT) and left their Brazilian output unchanged at a record 71.5-72.0 MMT.

Argentina is seen dry this week, rain will be needed soon for soybean pod filling, say Martell Crop Projections.

The USDA have confirmed the sale of 220,000 MT of US wheat to unknown.

Private trade early estimates on US spring planting intentions will start to filter through in the next couple of weeks, before the USDA's initial stab at calling this season's acreage at the end of the month.

Early calls for this afternoon's CBOT session: beans up 12-15c, corn up 3-5c, wheat flat to up 2c.

Strike!

02/03/11 -- Reports are reaching Nogger Towers of "up to 70 workers" walking off the BP Saltend site yesterday afternoon in a dispute over job losses. Google it if you like, but further details are a bit thin on the ground although I did find this: Don't picket, it'll never get better

And this poor woman had to walk to work from Preston this morning, so it must be one hell of a blockade: I don't think she means THAT Preston

Morning Vibe

02/03/11 -- The overnights are mixed with beans around 13-14c higher, corn up 1-2c and wheat flat to down 4c.

Wheat seems to be lower on the back of an improved weather outlook for US and Chinese wheat.

Some much needed precipitation may be on the cards for America's parched top wheat producing state. "Kansas may finally get wet, with the 7 day outlook hopeful for rain," according to Gail Martell of Martell Crop Projections.

It could certainly do with some help. Kansas Agricultural Statistics Service reported on Monday that 40 percent of the wheat in the state is in poor to very poor condition, with only 25% rated good/excellent (only 2% of that was excellent).

Meanwhile decent weekend rains cut the area of Chinese wheat affected by drought by two thirds to 2.5 million hectares.

Beans are up on rains hampering harvesting in Brazil it would seem. Surely that is just delaying the inevitable record crop? In fact Celeres report that the harvested pace - 19% as of Friday - might be behind last season, but it's above the five year average (15%).

There aren't too many changes on the currency front so far, with the pound settling around 1.6250, having broke above 1.63 for the first time since Jan 2010 yesterday.

In the UK demand from compounders is lacklustre. There are soya hulls offered back on resale in both Liverpool and on the Humber if anybody wants any. Spot citrus pellets traded GBP182 ex Liverpool yesterday. Potentially got imported sugar beet pellets ex Liverpool and/or Humber to do and maybe some spot wheat distillers meal on a delivered basis POA. The odd load of corn gluten ex Liverpool and Humber available too. Also Brazilian soya pellets ex Liverpool and hi-pro soya ex Humber.

Chicago Closing Comments

01/03/11 -- Soybeans: Mar CBOT beans closed 10 1/4 cents higher at USD13.67 1/2 a bushel, Mar soymeal rose USD1.60 to USD358.00 and Mar oil climbed 30 points to 57.07. Harvest delays in Brazil, strength in the crude oil market and a weaker tone to the US dollar added support. A drier and warmer pattern for Argentina was also modestly bullish, even so Michael Cordonnier yesterday upped his Argy crop estimate by 1.5 MMT to 48.5 MMT.

Corn: CBOT Mar corn rose 4 3/4c to USD7.27 1/4 a bushel, CBOT May corn was up 4 1/2c to USD7.35 1/2 a bushel. Funds bought an estimated 5,000 contracts on the day. Firmer crude oil on the back of the situation in the Middle East lent support. Other than that news was limited. China sold only 165 TMT of the 1.2 MMT of corn on offer at this week's government auction.

Wheat: CBOT May wheat dropped 6 3/4c to USD8.10 1/4 a bushel, KCBT May fell 1/2c to USD9.12 and MGEX May declined 1 1/2c to USD9.39 1/2. Again fresh news was lacking. Japan is bidding for 129,000 MT of all US wheat on Thursday. US winter wheat crop conditions are poor, although the market seemed to be expecting that. China's drought situation has improved significantly over the weekend. ABARES said that the world will produce 675 MMT of wheat in 2011.

EU Wheat Declines Late In The Day

01/03/11 -- EU wheat futures closed lower with Mar London wheat down GBP1.15 at GBP199.85/tonne, and new crop Nov falling GBP1.50 to GBP163.00/tonne. Paris wheat closed with Mar EUR0.25 lower to EUR257.25/tonne and Nov down EUR0.75 to EUR218.50/tonne.

Wheat was higher for most of the day, but slid into negative territory late on as Chicago fell and crude oil gained.

The situation in the Middle East continues to drive oil higher, prompting a switch out of "risky" grains.

"Soil moisture has improved in France, the UK, and Spain with increased rainfall in the past 2 weeks, although more is needed," say Martell Crop Projections.

Crop conditions in the US meanwhile are giving serious cause for concern, with winter wheat in Kansas - the top producing state - now rated only 25% good/excellent compared with 53% a year ago.

ABARES say that the world will produce 675 MMT of wheat in 2011, some 30 MMT or 4.7% up on last year.

A resurgent pound, buoyed by ideas of modest interest rate rises during the second half of 2011, capped London wheat gains.

Domestic demand from the feed sector remains sluggish at best.

Early Call On Chicago

01/03/11 -- The overnights closed mixed with beans generally around 5-6c higher, wheat down 4-5c and corn only fractions either way.

News is thin on the ground although that doesn't mean that the arrival of a new month won't bring with it fresh money inflows. Crude oil is firmer and the dollar weaker, which may also provide some support.

South American soybean production estimates are creeping higher with private analyst Michael Cordonnier yesterday upping his Argy crop estimate by 1.5 MMT to 48.5 MMT.

Despite persistent rain the Brazilian harvest is moving on at 19% complete as of last Friday. That's slightly ahead of average, although behind last year's early pace.

ABARES confirm that the Australian wheat crop was a record 26.3 MMT in 2010, but output may fall 2 MMT in 2011 as this season's bumper yields fall back to more normal levels. It will be interesting to see how things pan out as the wet weather in the east may mean that the crop gets off to a better start than normal. Don't forget too that if we hadn't had a bad drought in WA then we'd have been looking at a national crop in excess of 30 MMT in 2010.

ABARES also say that the world will produce 675 MMT of wheat in 2011.

Japan is shopping for 129,000 MT of all US wheat on Thursday.

China sold only 165 TMT of the 1.2 MMT of corn on offer at this week's government auction. They remain conspicuous by their absence from the export market.

Early calls for this afternoon's CBOT session: corn flat to up 1c, beans up 5-7c, wheat down 2-5c.

Do You Want Nuts With That?

01/03/11 -- A Covent Garden retailer has apparently been persuaded to withdraw "Baby Gaga" breast milk ice cream from sale after complaints to the council.

Yes, I have checked the calendar and there's still a full month to go before April Fools Day.

The incredulous owner was struggling to see why anyone would object, no doubt as he tucked into his organic lentil and hummus wrap. He probably gave the interview whilst simultaneously helping hand pump several gallons of his raw material from passing Casandras I should imagine.

Get yourself a proper job son.

Raspberry Nipple?

The cheesemonger bloke in the stall next door is keeping his head down now I bet. You've heard of Stinking Bishop haven't you? That was originally called something else but they had to drop the word "Helmet" for legal reasons.

Come on, there's a global food shortage on so there's no point throwing perfectly good stuff away is there?

EU Rapemeal Prices

01/03/11 -- Latest guide prices for EU rapemeal.

Basis FOB Lower Rhine in euros/metric tonne, with change from previous trading session:

Pound Hits 13-Month High

01/03/11 -- The pound is up above 1.63 against the US dollar for the first time since mid-January 2010 this morning as pundits price in an interest rate rise sooner rather than later.

May or June seems to be a lot of people's favourite once we have an anticipated inflation rate of around 5% plus, from the current 4.7%. Soaring food and fuel prices are seen forcing the BoE's MPC to up base rates from the existing all-time low of 0.5%.

UBS said in a survey that food prices in the UK are rising far more quickly than in other leading global economies. Meanwhile petrol prices are now even higher then when oil reached USD147/barrel in 2008, with now diesel averaging 134.9ppl locally to me (the highest price I recall paying back then was 132.9ppl).

In February the MPC voted 6-3 in favour of leaving rates on hold, more of a split decision than previously, we get to find out the outcome of their March vote next Thursday.

Meanwhile even ABF-owned High Street discount clothing retailer Primark is starting to feel the pinch, saying that the VAT increase had led to a "noticeable" slowing of demand since the turn of the year.

Nationwide say that the housing market is "treading water" with prices up slightly in February, but still fractionally lower than twelve months ago.

On the continemt euro-zone inflation is also up this month, but at 2.4% it's only half of that in the UK.

Chicago Close

28/02/11 -- Soybeans: Mar beans closed 8 1/4c lower at USD13.57 1/4; Mar soymeal ended down USD3.30 at USD356.40, Mar soyoil closed 18 points lower at 56.77. Rain is delaying the Brazilian harvest, but once it comes in it looks like being a record 70-72 MMT. The outlook in Argentina has also improved significantly from early in the season. Chinese buying is seen switching to South America, and also falling from above 5 MMT/month to closer to 3 MMT this month. Export inspections were however strong at 48.6 million bushels.

Corn: Corn rebounded from early losses to close with Mar up 10 1/2c at USD7.22 1/2; Dec was up 5c at USD6.06 3/4. Export inspections weren't very bright at only 24 million bushels, versus 39 million last week. Even so corn managed to shrug off early losses with front month Mar posting its highest close for a nearby contract since early July 2008. Funds were estimated to have bought around 5,000 contracts on the day.

Wheat: CBOT March wheat was up 6c to USD7.82 1/2 per bushel; MGEX wheat climbed 15 cents to USD9.30 3/4; KCBT wheat ended up 15 cents to USD9.02 1/2. A strong showing in Saudi Arabia's weekend tender lent support as did a weaker dollar. Export inspections however were on the low side at 19.5 million bushels compared to 31 million last week. China's wheat crop got some much needed rain over the weekend.

World Crop Weather Highlights

28/02/11 -- World agri-weather highlights from Martell Crop Projections:

• Heavy rain hit Eastern Midwest Sunday, second major storm in a week: flooding occurring; forecast calling for more heavy rain; still very cold northern US, subzero F nights; snow persisting Upper Midwest, northern spring wheat


• Brazil Mato Grosso soybeans heavy rainfall yesterday; way above normal rain past 2 weeks; South Brazil relatively dry since mid February; same weather pattern to prevail this week


• Warm days, cool nights Argentina grain belt; soil moisture favourable Cordoba, Santa Fe, Entre Rios; too dry and warm in the southwest Argentina, La Pampa and western Buenos Aires


• Europe warm west, cold east; dominant Feb weather pattern; recent rain helpful in France but still way too dry; 2-4 inch moisture deficits Jan-Feb; severe dryness also in Slovakia, Hungary, Balkans; dry forecast, no relief


• Western Australia very hot 98 to 103 F; rain is predicted; spotty showers yesterday in northern New South Wales, February has been dry; forecast continues wet north Australia tropics


• China showers Sunday in winter wheat, up to 0.80 inch, drought easing; cool temperatures slowing wheat growth; forecast becoming favourably wet in Central-East China rapeseed; rain badly needed, also too dry


• Cool, showery weather Pakistan, Northwest India favours winter wheat development; unsettled conditions to continue with below-normal temps; wheat yield potential good and improving


• Russia winter wheat stuck in cold wintry pattern; cold high pressure prevails; very dry and cold February in Ukraine, Russia, Black Sea winter wheat; more of the same this week in forecast

EU Wheat Close

28/02/11 -- EU wheat closed lower with Mar London wheat down GBP0.50 to GBP201.00/tonne and new crop Nov GBP2.25 easier at GBP164.50/tonne. Mar Paris wheat fell EUR1.50 to EUR257.50/tonne, with Nov EUR3.25 lower at EUR219.25/tonne.

Weekend rains/snow in China reduced the area there affected by drought to 2.52 million hectares, according to the Ministry of Water Resources, that's two thirds down on where we were at the height of the problem.

Saudi Arabia bought 275,000 MT of wheat over the weekend, one cargo coming from a surprise source - Brazil. The remainder was made up of US wheat.

EU soft wheat export licences were 439,000 MT last week, but we need to keep up that pace for the remainder of the marketing year to hit the USDA's target of 21.5 MMT in the 2010/11 season. We've only managed to better that total once so far this year.

Crude oil was flat after last week's excitement, with few changes to the Middle Eastern situation over the weekend.

The pound rose against both the dollar and the euro, depressing UK values.

Weaker US markets following Friday's strong gains were probably influenced by profit-taking and poor weekly US export inspections of less than 20 million bushels compared to 31.2 million last week.

BradburyWatch

28/02/11 -- Libya and the Middle East contagion have lost centre stage today on the shock news that BBC's Countryfile sex goddess Julia Bradbury is pregnant. It's a 'miracle' she says. It certainly is Julia because I had a vasectomy in 1993, and don't go giving me the "toilet seat" excuse because it just won't wash.

I'm going to have to dismantle my bedroom "shrine to Julia" now as well, it took me ages to make that. Well that's it baby, we're his-tor-y. I've never been so let down since I found out that Peter Purves had been tupping Valerie Singleton all those years I salivated into my sticky-backed plastic. I really wish I hadn't deleted all those begging text messages from Kylie now too. Bugger.

EU Rapemeal Prices

28/02/11 -- Rapemeal prices are up today following Friday's strong gains in Chicago.

Here's the latest guide prices for EU rapemeal, basis FOB Lower Rhine in euros/metric tonne, with change from previous trading session:

Early Thoughts

28/02/11 -- Fresh news is a little thin on the ground this morning. China got some decent rain/snow over the weekend, which may have improved the outlook for winter wheat there Weekend falls ease drought.

Saudi Arabia bought 275,000 MT of wheat over the weekend, mostly from the US.

Argentina will be dry for the next ten days whilst Brazil remains overly wet, say QT Weather.

The pound is up against both the dollar and euro, but nobody seems to know why. London and Paris wheat open a little easier.

Australia's wheat stocks at the end of January are 30% up on a year ago at 22 MMT, according to the Bureau of Statistics there. After the bumper harvest in the east, NSW has the highest stocks holding 35% of the nation's wheat.

ABF say that its interim results will be in line with market expectations.

Glencore are said to be considering the largest ever London stock market flotation, according to the Times.