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November 16 London wheat closed up 15p yesterday.
US markets were down but the slide slowed. Much of the US markets fall was attributed to non-commercials / funds long liquidated positions. Hot dry weather was forecast 2 weeks ago and funds took 5 year high long positions, since then, wetter milder weather has reduced threats to crops. Soya also found support from technical resistance levels.
Conjecture about UK wheat quality and yield; assuming 14.5 mmt wheat crop, a fall of 3 kg/hl from assumed weights would reduce crop by 4%, c.580,000 tonnes.
Sterling weak and UK wheat quality better than French; this may provoke export interest. French wheat production reduced on weather conditions.
UK wheat supply / demand influenced by bio fuels with Ensus starting production again. Ensus benefitted from lower raw material price but bio fuel production dependant on EU mandates and Brexit impact.
Black sea poised to be biggest global grain shipper.
Brent crude c. $49 barrel
author: Joe Beardshaw