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London wheat lost much of Fridays gains, closing 80p - £1.50 down in various positions. The May - November spread has increased to £9.25.
Markets continue to come under pressure, oil fell to a 12 year low (exceeding the 2008 fall) to trade at $31.41 barrel. Copper reached 6 year lows, however Chinese stocks bounced.
UK export figures for November did not encourage the market. November wheat exports were 138,000t, bringing seasonal total to 656,000t; maize imports were 260,000t to total 816,000t for season. Barley exports were 120,000 to total 620,000t.
USDA report is due today and pre report rumours are for increased US stocks due to slow exports; this may have been factored into the market causing recent falls.
Funds are very short on agricultural commodities and short covering could produce a price spike, especially if USDA is not as bearish as anticipated.
South America continues to be an aggressive seller of corn, soya, and wheat due to weak currency (Brazil / Argentina) and easing of export restrictions (Argentina).
author: Joe Beardshaw