Morning Markets

30/08/12 -- The overnight Globex grains are mostly a little lower in light consolidation following last night's decent gains. Beans are currently 4-6 cents easier, with wheat down 2-3 cents and corn a cent or so either side.

There's optimism around that the US will at least win a share of Saudi Arabia's 550 TMT wheat tender which closes tomorrow. The Saudis do have a habit of sharing their business around, so they probably will get a slice of the cake along with Australia and Canada, and maybe Europe too.

Is the timing of the Saudi tender co-incidentally timed to match Friday's Russian head honcho meeting to discuss what to do about the rapid early pace of Russian grain exports as a pretty poor harvest winds up? Probably not. I wonder though what the market will do though if Russia doesn't actually do anything on Friday except make some kind of announcement that they will continue to monitor the situation?

Thailand may import up to 1.5 MMT of feed wheat in 2012/13, five times it's normal purchases, due to high world corn prices, according to one report I read this morning. The not too fussy Thais will be looking around for the cheap option, and likely find it's India methinks.

The word on the streets of New Orleans is that Hurricane Isaac hasn't been as bad or caused as much damage as was feared. Hopefully that will be true of the corn crop too. It will help boost low water levels on the Mississippi though, and may bring some spin off rains to HRW wheat areas ahead of planting. Every cloud eh?

There seems to be good interest around for soymeal, despite Chicago closing within USD10/ton of the all time highs last night. Vietnam has bought 140 TMT of Argy soymeal at around USD685/tonne for LH Sep shipment, according to the morning wires.

It pissed it down big time in the early hours of this morning up here in North Yorkshire, which will further frustrate any thoughts of getting a combine into the wheat. It's not raining on MARS though, so their estimate for a UK wheat yield of 7.82 MT/ha still looks good, at least to them. Mind you, if it's harvested at 20% moisture then maybe they're right.

South East Asia have imported 21% less US DDGS in the first half of 2012 due to high prices and changes in quality is another headline that grabs my attention this morning. There's been a fair bit of talk of DDGS quality declining after the ethanol blenders' tax credit was removed at the end of 2011.

In an effort to claw some margin back some US ethanol plants have been removing more corn oil in the distilling process, with corn oil worth about four times more than the price of DDGS then why wouldn't they? That leaves less oil of course in the by-product, making DDGS not as an attractive feed as it was.

Favourable weather during February and March has seen the USDA's attache in Morocco raise their forecast for wheat production in the North African nation from 2.8 MMT to 3.4 MMT, and for barley from 0.9 MMT to 1.1 MMT. They've thus cut their estimate on Morocco's wheat imports in 2012/13 from 5 MMT to 4.5 MMT.