Currencies
The £ has recovered slightly from its sharp drop last week which had Sterling at the lowest levels since March, which were briefly lower than just after the Brexit vote in June 2016.
The recovery this week was influenced by the fact that despite the tension surrounding the threat of breaking already agreed parts of the withdrawal agreement, both sides continue to sit down and discuss the agreement because both sides need a deal to come out of this.
The UK did sign its first major post Brexit trade deal this week with Japan which was seen as a significant step forward.
In the US reports this week put the US economy is on target to shrink by 3.7% during this year. The European Central Bank meeting coming up will be looking at further stimulus packages.
Wheat
Wheat has seen another strong week following the rise of corn and soya.
The US market which had been slowing, has turned following reports that swine flu has been detected in Germany, which may mean that China could consider switching some of their demand to pigs sourced from the US, which would diminish the corn surplus.
The UK market had been moving lower as currency improved, but that has now switched and prices are following the rest of the global pattern up. It is difficult to see how this continued rally can be sustained when the UK import programme is now in the full swing, with the options of barley and maize are still featuring in formulations partly in preference to wheat, which will reduce the amount of wheat required.
Looking at the global picture, world wheat production has been pushed higher again by a further 4.46 MlnT, up to 770.49 MlnT.
Soya
Soya continued to rally hitting season highs for beans of well over $10. This was off the back of the USDA report which lowered end stocks by more than the market had anticipated, following a drop in ratings of 63% good/excellent.
China has continued to buy US beans, but have also switched to buying Brazilian at a premium which shows the political concerns around the US/China relationship.
Reports this week showed that the Chinese pig herd are up 31% year over the year, which is a faster recovery from their African swine flu than had been expected.
There is still currently a surplus of soya globally with the 20/21 US soya plantings predicted to be up 4.9% from this year, but because the market had so much of the good news factored into prices for so long, any adverse crop news or demand increase news is likely to cause these sharp rallies.
And Finally…
1950’s village housewife known for her perfect scones found to also have been a Colonal in Russian Intelligence.
A new book released this week details the life of a Mrs Burton, a well-respected member of an Oxfordshire village who had moved into one of the local farmhouses with her husband and three children shortly after the war. Here they appeared the perfect family with Mrs Burton heavily involved in village life and renowned for her baking. It turned out that Mrs Burton was actually Colonal Ursula Kuczynski of the Red Army, a decorated Soviet intelligence officer who had been sent to the UK on Moscow’s orders.
Russia believed it was not right for the UK and US to share their developments in Nucelar knowledge with the rest of the world, which was why it strategically placed intelligence officers like Colonal Kuczynski in the UK.
The privy (outdoor loo for some of our younger readers) at the end of her garden, had a radio transmitter which she would send reports to Moscow from three times a week until 1950 when she fled for East Berlin with her children after a fellow officer in the UK was caught.
Presumably the weekly reports contained a little more than the recipe for the perfect scone!
Regards,
Kay Johnson & Martin Humphrey
