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London wheat closed up £1.20 to register gains of £2.25 for the week; French wheat was €3.50 down for the week.
Since the Brexit vote, Sterling is down 17% against $ and 14% against €. U.K wheat has risen 12% since the vote and French wheat has declined 4% highlighting currency impact.
French wheat exports are down due to poor quality and stronger currency a drop of 20% year on year; only 25% of French wheat is making 76 kg/hl against 80% last year. France has smaller crop but imports are up, wheat from places like Romania are bought for blending. The demise of French exports has benefitted Russia; Russia are gaining a bigger share of export market.
US markets tried to rally on Friday but closed down (e.g soya 18 cent range on the day). Funds increased their short position on wheat which will provoke short covering / correction at some stage. Poor jobs data has reduced the expectation of an interest rate rise. October USDA is on Wednesday, this may have a major impact as it will publish harvested acres, yield and production.
French winter wheat 6% planted against 17% this time last year; dryness continues to cause delays. Dry weather is also affecting maize harvest, EU crop further reduced 2.8 mmt to 59.7 mmtauthor: Joe Beardshaw