Currency

The £ continues to rally against the $ on the back of uncertainty over the US economy.  The £ at one point reached back over 1.32 before settling back down again to around 1.30.  The retail data which came out from the US last week was lower than expected and there are concerns over the size of the fiscal recovery package being discussed, circa $2 trillion.  As well as the size, there have been concerns over how quickly any package will be implemented with the Senate having passed the legislation from their side, but the House are not currently in session and it must also be passed through them as well.  The £ did lose some of its value against the € after the new quarantine restrictions for those returning from further foreign countries were introduced, with concerns arising as to how that would further impact UK based travel firms.  Talks have now begun in Brussels around any Brexit deal some optimism on our side that some sort of deal would be completed by September, and pessimism from the side of the EU. 

Wheat

The USDA report last week was overall bearish to wheat however, the market still rallied post report.  This was because of a large amount of fund buying ahead of a planned US/China Phase One trade summit which was due to take place on the 15th August but was cancelled last minute without any new date proposed.  The market has since begun to retrace that rally back to previous levels.  Looking at the details of the report, global production fell 3.3 Mln T, (driven by a 4 Mln T reduction in European production), however, higher closing stocks and lower demand still meant end stocks were increased to 316.8 Mln T.  Looking at Europe, Matiff and Liffe front months rallied following the report and a further downgrade in production figures by Strategie Grain.  There has also been an increase in demand on the nearby months as it would appear most consumers have been waiting for harvest to take cover.  Early yield indications show a range of 7.3 t/ha- 7.8 t/ha against an average of around 8.4 t/ha, perhaps not quite the disaster that had been expected in the earlier part of the year. 

The surplus of barley in the UK and the availability of imported maize past October will help keep a lid on feed wheat prices going forward but outside political factors are likely to cause swings in prices towards the back end of this year and early part of next year. 

Soya

Soya has had a choppy week.  The market initially followed wheat and did rally post USDA report with the influx of fund buying in anticipation of the US/China meeting, before retracing back to pre report levels.  It has ended the week in a second rally following concerns that there may be storm damage to the Iowa crop following hurricane strength winds there.  The crop was downgraded in anticipation of this from 74% good/excellent to 73%.  Funds are still short overall beans and meal but the numbers are fairly modest compared to what they have been.  Even with the slight downgrade, nothing has really changed fundamentally with the crop so at some point, the market will turn its focus back to that.  The pod count was reported to be 1,297.93, ahead of the 3 year average, 1,213.64.  We may also now see a slow down in Chinese buying and that was likely to have driven by the planned meeting in order to show commitment.

And Finally…
Bored Ravens leave site in search of food due to the lack of tourists leaving fears that the monarchy could crumble!

Some of the captive Ravens kept at the tower have been caught sneaking out of the Tower perimeter due to the lack of attention from the hordes of tourists which would normally be visiting the tower this time of year.  Numbers are down from 15,000 per day to around 8,000. 

It is not clear how long captive ravens have been held in the Tower for, though the intelligent birds, which are common in Britain, often nested in towns throughout history.

Legend suggests that 7 ravens must always remain at the tower, otherwise the Crown and the Tower would fall.  The Tower's relationship with captive ravens could date back to King Charles II, who reigned in the mid-17th century.

Charles II is thought to have been the first to insist that the ravens of the Tower be protected after he was warned that the crown and the Tower itself would fall if they left.

The King's order was given against the wishes of his astronomer, John Flamsteed, who complained the ravens impeded the business of his observatory.

Regards,

Kay Johnson & Martin Humphrey