Headlines:
- THE NEXT USDA WASDE REPORT WILL BE OUT OCTOBER 12TH
- EGYPTIAN WHEAT IMPORTS TO HIT RECORD HIGH, DESPITE ERGOT FUROR
The ergot furor, and a “persistent shortage” of foreign currency, will take some toll on Egypt’s wheat imports – but not much US officials said, still forecasting that 2016-17 purchases will hit a record high. The US Department of Agriculture’s Cairo bureau cut its forecast for Egypt’s wheat imports this season to 11.8m tonnes, flagging the setback from a foreign currency squeeze that has “made opening letters of credit more difficult”, and noting hiccups from the zero tolerance on ergot too. Egypt’s wheat imports have been “disrupted continuously since December, when a French shipment was rejected due to Egypt’s attempts to enforce a zero tolerance for ergot”, the bureau said. Ergot, a fungal infection of wheat, can cause hallucinations if ingested in sufficient quantities, but is difficult to eradicate completely from shipments, and importers typically allow levels up to 0.05%. - BLACK EARTH UNDERLINES CLOUD OVER QUALITY OF RUSSIA‘S HUGE WHEAT HARVEST
Black Earth Farming revealed it had fallen victim to the wet conditions which exacerbated the quality setbacks to Russia’s – huge – wheat harvest this year, leaving the group facing a steep discount on its sales prices. The farm operator in Russia’s central region said it had achieved “record” yields in winter wheat and spring barley harvest, of 4.3 tonnes per hectare and 2.2 tonnes per hectare respectively. However, that was below the yield figures of 4.9 tonnes per hectare and 2.8 tonnes per hectare the group achieved in its early harvest, as revealed in August. And Black Earth cautioned that crop quality has been “significantly reduced”, thanks to a “very wet August, which delayed harvest and caused grains to chit in the ear”. Wet weather on ripe crops can encourage kernels to sprout, cutting their suitability for food consumption and, in extreme cases, even for use in livestock feed.
Summary:
The harvest is in full swing and between the Crop Progress report that is scheduled for release at 4 Eastern today and the USDA WASDE reports set for tomorrow at noon Eastern, the grain markets have been pretty quiet in trading today. While producers focus on harvesting their crops there has not been a lot of selling by producers either. December Corn was up 2.25 today and March Corn was up 1.75. Soybean was essentially flat with the November contract settling down 1.00 and the January contract off 0.75. Wheat added to the gains from yesterday and was up 3.25 and is approaching the high end of what has been a strong trading range that has contained the futures price action for a few months now.
Weekly export inspections for Corn and Wheat were right in line with Corn trade estimates coming in at 1.131 MMT where expectations ranged from 1.1 to 1.4 MMT and Wheat export inspections coming in at 0.433 MMT versus the trade estimate range of 0.4 to 0.6 MMT. The Soybean weekly export inspections were rather strong coming in at 1.801 MMT versus the trade estimate range of 1.0 to 1.2 MMT.
