UK Wheat Harvest Snapshot
YORKS
The wheat crop is around 30% cut according to most estimates, with moistures commonly coming in around 20%. Some quality loss is evident although yields appear to be generally fairly good at 3.5-3.8mt/acre.
WARWKS
Around 20% of the wheat crop has been cut is the general consensus, with moistures up to 23% being mentioned although 20% is more like average. Yields generally very good with around 4mt/acre commonplace. Hagbergs a little lower than hoped for.
LINCS
Around 50% cut with moistures coming in generally in the 18-19% range. Yields very good, 4mt/acre common with some making 5mt/acre. Hagbergs not to bad.
NORFOLK/SUFFOLK
Around 30% cut, quality and hagbergs largely pretty good, yields very good with 4mt/acre common and 5mt+/acre not unusual. Moisture levels around 17-19%.
“The wheat yields are the probably the best wheat yields we've ever had in farming. There have been some exceptional yields and a great deal of farmers have done that as well and not just us. Everybody is just getting a great yield,” enthused one farmer.
Cargill Fails in US$10 Million Damages Claim Against Former Workers
Cargill has failed in its bid to claim US$10.2 million damages from former employees it accused of stealing trade secrets when they left to form their own company, says Flex News.
Cargill brought the case against the trio, Matt Budine, Brian Sundberg, and Luciana Jonkman, after they formed dairy nutrition and management consultancy firm Progressive Dairy Solutions, accusing them of misappropriation of trade secrets, breach of contract, and fraud.
Following a three-week trial in Fresno, California, a federal court jury dismissed Cargill’s claims, declaring them to be “objectively specious”*. Lawyers for the three former Cargill workers said this could be defined as the court deciding Cargill’s case had lacked any basis in evidence.**
* Yes, I had to look that up too: Having the ring of truth or plausibility but actually fallacious.
** The "Big C" unsurprisingly didn't quite put the same interpretation on things as the defendant's lawyers saying that "that neither side has prevailed on any claim against the other side," and that it was considering an appeal.
Ukraine has over 2mmt of unwanted rapeseed in store
Since the harvest was completed in Ukraine, the export of rapeseed has steadily been decreasing, Sergey Melnik, the Deputy Minister of Agricultural Policy said Friday.
More than 2 mln tonnes of rapeseed, from a harvest of 2.8 mln tonnes, are now in storage, according to the Deputy Minister.
The decrease of rapeseed exports was caused by large harvests of the oilseed in European countries, which prefer to process their own rapeseed and are not interested in purchasing imports of Ukrainian rapeseed, he added.
Further, Ukraine now needs to act to deal with future problems due to full storage facilities since the sunflower and maize harvesting campaign has already begun, noted Melnik.
Poor old Ukraine, not only do they have very noisy and aggressive neighbours, we implore them to produce more oilseed rape for us then we tell them we don't want it. They have virtually no domestic requirement for rapeseed and almost all of their production is for export.
Australia rains latest
The onset of rain this weekend heralds the arrival of a wet week along Australia's east coast, according to weatherzone.com.au
By late Saturday, a rain-bearing system originating over warm waters off the West Australian coast had spread across Australia's interior to reach the NSW coast.
The heaviest of the rain is set to clear from NSW by late Sunday, however falls over eastern Queensland are likely to continue until at least Thursday thanks to a persistent stream of tropical moisture.
By Friday computer model guidance indicates a deep trough of low pressure is a strong chance to form off the coast of NSW and southern Queensland, bringing strong winds, large seas and locally heavy rain.
In the event of the trough forming, parts of the coastal strip between Sydney and Brisbane are likely to pick up more rain in the first week of September than fell throughout August.
Elsewhere a deep trough dumped heavy rainfalls across northern South Australia and southern parts of the Northern Territory Friday night.
The heaviest fall was at Oodnadatta Airport where 28.2 millimetres was recorded in the twenty four hours to 9am. This amazing fall was the heaviest August rainfall since 1975, and accounts for 75 percent of Oodnadatta’s total rain since January this year.
Review of the week
CBOT CORN
CBOT corn closed with Sepember 18 1/4c lower on the week. There is still some uncertainty about the overall impact on yields for this late planted crop. Still the IGC Friday increased it's global production estimate to 774mmt from 759mmt a month earlier.
Sharply lower wheat prices also weighed on corn.
CBOT SOYBEANS
CBOT soybeans had a quiet week, fluctuating this way and that before closing with a net gain of 11c overall for the Sept future. Uncertainty over the impact of Hurricane Gustav and the Russian/West conflict is supportive for crude oil which is in turn helping soybeans at the moment.
Ideas that Chinese demand which has waned badly this last month will increase due to a public holiday there next month has also added some modest support.
CBOT WHEAT
CBOT wheat suffered it's biggest weekly drop in five months, closing lower every session this week for September to finish with a loss of 86 1/4c on the week. The IGC upped it's global production estimate 10mmt from last month to 672mmt.
The only areas of concern for wheat recently have been Argentina and Australia, both have seen or are expected to get significant rains this week/weekend.
LONDON FEED WHEAT
November wheat lost GBP5.50 on the week, and is now GBP32/tonne lower since the beginning of July.
With a UK wheat crop of around 17mmt expected (up 24% from 13.7mmt in 2007), giving us a 4mmt exportable surplus of largely feed grade wheat due to adverse weather conditions in July and August its not surprising that wheat is under pressure.
The Ukraine are reckoned to have a crop in the region of 27mmt (almost double 2007's 13mmt) and 89% of it is said to be feed wheat (down from 60% in 2007).
In June/July Ukraine exported almost 1mmt wheat, just over 1mmt of barley and over 1.5mmt of corn.
PARIS MILLING WHEAT
November Paris milling wheat closed the week with a loss of EUR8.80/tonne as virtually every country around the world is reporting larger wheat crops than earlier anticipated.
PARIS RAPESEED
The November contract finished the week EUR6.50 lower as the European harvest draws to a close. The EU is reckoned to have a crop of around 19mmt and the Ukraine one of almost 3mmt. Canada will be the next big producer to start cutting and they are reckoned to have the potential for a record crop too, well in excess of 10mmt compared 8.8mmt in 2007.
PARIS CORN
Nov corn closed EUR3 lower on the week as the wheat market declined.
CRUDE OIL
October crude closed the week just 87c firmer despite the threat to US supplies from Hurricane Gustav and the threat of Russia pulling the plug on gas supplies to Europe.
CBOT Closing Comments
CORN
Corn futures closed slightly lower on the last trading day in August. Corn backed off of highs earlier in the day and was pulled lower on declines in crude oil and squaring of positions. Almost all commodities traded quietly ahead of a long weekend filled with a lot of uncertainty. Concerns of TS Gustav damaging oil rigs and/or damaging ports along the delta and Mississippi River pushed prices lower. Those damaging concerns could result in delays in exports or dump beneficial rains in Midwest and Corn Belt regions. Due to the uncertainty left traders taking cautious positions ahead of the holiday. Liquidation of contracts was present yesterday, open interest was down around 20,000 contracts for the second time this week. Sep -1c at $5.68.
SOYBEANS
Soybeans were flat on quite trade Friday. Soybeans are vulnerable to weather, pods are filling and needing additional moisture in most regions and the plants needs warm days to mature ahead of a damaging frost. Cash markets firmed and are adding support to beans while crude oil slumps pressuring the soy complex. The US dollar index found strength also weighing in on prices. Soybean stocks are pipeline tight and any disruption in expectations of production could push prices in either direction. Sep -1/2c at 13.32; Meal -12 at 367.40; BO +6 at 53.40.
WHEAT
Wheat futures were mixed on Friday, CBOT and KC posted losses while MPLS marked gains in nearby contracts. Funds were sellers of 2,000 CBT contracts, wheat continues to be pressured by the lingering fact of a huge world crop; Australia and Argentina received beneficial rains this week insuring their crops. CBOT wheat had 3,561 contracts posting delivery notices at CBOT. That was significantly higher than trade estimates, KC deliveries of 109 lots, and MPLS issued 215 contracts. The large amount of deliveries was triggered by weakness in basis. CHI -9c at 7.79; KC -6c at 8.18 ; MPLS +5c at 8.61.
Crude Ends Little Changed On Ideas US Prepared For Gustav
Crude oil was little changed as Hurricane Gustav approached the Gulf of Mexico, amid speculation that energy producers are better prepared to face a hurricane than when Katrina struck in 2005.
Prices climbed as much as $3.17 a barrel earlier Friday as Royal Dutch Shell Plc and BP Plc said they will pull workers from Gulf platforms and shut production in a region that pumps 26 percent of U.S. oil and 14 percent of the nation's gas. Gustav was declared a hurricane after the oil market settled.
Crude oil for October delivery fell 13 cents to settle at $115.46 a barrel at 2:42 p.m. on the New York Mercantile Exchange. Still, futures are up 57 percent from a year ago.
EU Wheat Closes With London At 9 Month Low - IGC Raises World Crop Est 10MMT
EU wheat futures closed the week with November London feed wheat at GBP120/tonne, its lowest level in nine months.
The world crop just keeps getting bigger with the IGC Friday raising it's global production estimate pushing the world wheat crop to 672 million mt from 662 million mt a month ago, lifting ending stocks to their highest levels since 2002-03.
US wheat futures continue to decline with Chicago futures settling lower for the sixth straight session.
Paris-based November milling wheat closed EUR1.25 lower at EUR186/tonne for a weekly loss of EUR8.25. London November feed wheat lost GBP5.50 on the week.
According to the HGCA 2.068m hectares of wheat was sown for the current season in the UK, with an average yield of 8.2mt/hectare that would give us an output of 16.9mmt compared to 13.7mmt in 2007.
Some analysts cite UK production in excess of 17mmt as reports of good to exceptional yields are coming in from all over the country. Quality may be a problem in some areas but yields seem to be uniformly above expectations.
