Currencies
Currency continues to give us the same small range movements we have become used to. Against the $, the £ is struggling to break that 1.39 resistance level still and against the €, it has crept up to 1.18 for only the second time since March. The Bank of England policy meeting last week sounded positive with inflation expected to reach 4% by the end of the year meaning that some policy restrictions will be needed to keep that 2% target, although they are still not expected to raise interest rates until 2023.
Wheat
Wheat has continued to push higher despite being in the harvest period. Last week ended at 13 month highs because of ongoing weather concerns and continuous downgrading of crops. The USDA report on Thursday confirmed all of the figures which had been indicated making it one of the most bullish August reports in its history. Overall corn and wheat production for 2021 has been lowered. Russia’s crop was downgraded from 85 MlnT to 72.5 MlnT, France has been cut from 40 MlnT to 36 MlnT and Canada is now at sub 25 Mlnt, with a normal harvest for them around 30 MlnT.
Looking at the UK, we are still looking at a crop of over 15 MlnT and the UK wheat price is technically still expensive for export so could see some downside, especially if the quality is an issue and we see more wheat being downgraded to feed looking for homes.
Soya
For soya the USDA report was largely neutral. There is no extreme heat in the US and adequate rains still in key areas. The crop seems to be upgraded at the moment each time a new crop report is released however, the real one to watch will be Chinese buying. Having been absent from the market for a few weeks, any dip in prices could encourage some big volumes destined for China.
And Finally…
RNLI Crews find lost dog 3 miles out to sea.
Ollie, a rather adventurous springer spaniel, sparked a three hour search near the Vale of Glamorgan. His worried owners called the rescue crews after Ollie went for a paddle but failed to return to the shore, instead swimming further out to sea. Eventually he was picked up 3 miles off the shore and enjoyed his ride back courtesy of the RNLI.
Regards,
Kay Johnson & Martin Humphrey
