The Morning Vibe

Posted by Nogger - a legend in his own mind at 08:48 | Categorized as

09/01/12 -- No surprises for guessing that it's been another hot and dry weekend in Argentina. That's what was forecast and that's what they got, so no changes there then.

What does appear to have changed over the weekend though is the weather forecast for the week ahead. WxRisk say that Sunday models show SOME good rains in central Argentina for Jan 10-11 but NOT the major 2-4" rains with 70% coverage that the GFS model was predicting on Friday.

At 9am the overnight grains currently see corn up 7-8 cents, beans up 10-12 cents and wheat tagging along for the ride 8-10 cents higher. Yes, wheat which is virtually fully harvested in Argentina is up more than corn which isn't even fully planted yet. There must be a woman driving this particular bull bus, that's all I can say!

In what already looks sure to be a volatile week we've got our chums the USDA out with their January numbers on Thursday. As mentioned elsewhere, corn has put in a limit move one way or the other in each of the last five years on the day of this particular report. Will it be up or down this time round?

The vibe in the market seems to be that there is probably more chance of a bearish report than a bullish one, but second guessing the USDA these days is virtually impossible so we're just going to have to wait and see.

Also due later this week are the first Spanish (Thursday) and Italian (Friday) bond auctions of 2012.

Prior to that German Chancellor Merkel and French President Sarkozy are meeting in Berlin today and are due to hold a press conference at 13.30 Central European Time.

Elsewhere the state of Western Australia has now brought in it's second largest grain harvest on record at 14 MMT - more than double last year's production, I gather. That's well above expectations of 11-12 MMT back in September.