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Grain markets generally had a quiet week, London wheat was up 10p on Friday, but on the week, old crop wheat was down 45p and new crop down 10p. US markets were also quiet, ignoring current cold weather in the plains; markets wait for USDA report due 31st March this may have a surprise in corn acres planted?
Market direction currently being driven by weather, currency and politics.
Weather has not really featured, European crops coming out of winter dormancy in satisfactory condition and Europe’s wheat crop for 2016 is estimated to be similar to last year.
U.K wheat crop forecast 14.8 – 15.0 mmt down on last year but would still mean exportable surplus; some reports of crop condition and disease levels may affect quality and yield.
Currency remains nervous, although the euro remains c. 1.28 against the pound; the CBI is the latest body to warn of the threat to UK economy from Brexit. $ has weakened helping $ denominated commodities.
Russian rouble has firmed, making their wheat more expensive in world markets, it is estimated they still have 4.9 mmt wheat to export before next harvest; Romanian, French and Ukrainian wheat all undercutting Russian supplies.
Oil down last few days but comfortably $40+, up from previous recent lows of $28; weaker $ helping support values. author: Joe Beardshaw