The Morning Paper

18/06/12 -- So, the pro-bailout New Democracy party won the Greek election by a narrow margin pipping the anti-austerity Syriza party into second place. The former will now be looking to form a coalition government, of which the latter has already said they want no part.

The markets have reacted with muted enthusiasm, although the New Democracy leader Antonis Samaras has already said that he will push for more lenient bailout terms from Europe than those that had previously been agreed.

It seems that maybe the lessons of last Monday may have been learned, when stocks shot up in the morning following the announcement of a EUR100 billion bailout for Spanish banks. Soon however, the realisation that "in reality we are EUR100 billion more in hock than we were last week" set in and everything eased back again.

What we now have is Greece probably wanting to restructure the debt that it already has, that it can't repay, into a more favourable debt over a longer period of time at lower rates, that it still won't repay.

Spanish 10-year bonds are above 7% this morning, as the market seemingly switches it's attention towards the ailing bigger fish in the European pond. They admitted on Friday that they were likely to miss their budget targets for this year.

Back to the fundamentals...

The US corn belt mostly got scattered showers and thundershowers over the weekend with rainfall amounts 0.20-1.25 inches), locally heavier in places, which is not the widespread soaking hoped for. Southern and eastern areas remain dry with little rain and above normal temperatures in the forecast for the week ahead.

The USDA will report on the latest crop condition ratings this evening. Last week we had 60% of the soybean crop and 66% of the corn crop rated good/excellent. I'd expect that we will see a 2-3 percentage point cut in each tonight.

Informa released some big planting estimates on Friday night, pegging the US corn area at 96.8 million acres, almost a million more than the USDA said last month. Soybean and spring wheat plantings were also placed well above the USDA's numbers.

Iraq has bought 100 TMT of Russian, 100 TMT of Australian and 50 TMT of Canadian wheat over the weekend.