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Yesterday, US markets lost some of the sizeable gains seen on Tuesday. Tuesday’s gains were not attributed to any fundamental change / reason but possibly more ‘book squaring’ before year end. $ closed against a basket of currencies at the highest level since 2002, curtailing the presence of US grain in export markets.
Corn is also weaker, there is speculation that the Trump administration is sceptical about ethanol benefits to the environment and may change ethanol mandate.
Wet weather in Argentina is hampering last soya and corn drilling but wheat area is up 20% (5.23 mh) which could see a production increase of 39% to 15.7 mmt, yields permitting.
Bird flu threat remains in EU, two wild birds in England and a third in Scotland have tested positive for bird flu.
Egypt announces it has sufficient wheat for 5 months.
Russian wheat exports reduce due to rouble strength; Russian economy is oil dependant and oil prices are stronger due to the reduced world production (Brent c. $57 barrel).
FTSE trades higher supported by strong mining company performance.
author: Joe Beardshaw