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Yesterday London wheat closed unchanged, there is speculation of whether the bottom of the market has been seen at £110 November futures (currently £112); a range of influences (currency/ exports, southern hemisphere weather, Russian exports, corn crop etc) make a firm prediction difficult.
HGCA latest estimates have wheat harvest 70% complete but yields have increased to 8.5-8.7 t/h from previous 8.3-8.6 t/h, this would mean 16 mmt crop; Scotland only 10% cut.
French wheat crop estimated as high as 40.7 mmt and exports are struggling but Egypt has raised its moisture spec from 13 to 13.5% until end of May 16, this should help chances of export.
French corn crop is down 25.7% compared to last year but last year was a record crop!
USDA report is due out today; September report has a reputation of being a low key report. It is expected that U.S yield will be cut and a reduction in corn and soya stocks but this was suggested last report. If corn stocks are cut it could see stocks to use ratio at 12% = Bullish
Global food prices have fallen at their fastest rate for 7 years (last month -5.2%) largely due to market glut, embargoes (Russia & china) and demand reduction (economic slowdown).
FAO raised world wheat crop to 728 mmt (+ 5mmt) and stocks a 13 year high at 202 mmt.
Despite rumours of interest rate hike, US wheat and corn firmer as $ weaker, there have been no new highs in last 6 months.
European GDP and falling unemployment could see euro firmer; sterling uncertain. author Joe Beardshaw