Wheat, It's The New Money!

EU wheat futures closed a relatively quiet session higher with Paris May milling wheat ending up EUR0.25 at EUR138.50/tonne and London May feed wheat closing up GBP1.70 at GBP111.50/tonne.

Firmer US grains and crude oil lent support ahead of tomorrow's USDA supply & demand report.

There seems to be a general consensus that carrying old-crop wheat isn't a great deal of threat at the moment. Maybe too many people are reading this blog?!

Certainly it looks like UK production will be sharply lower in the coming season, so if you don't need the cash there is little incentive to sell at current levels.

On the continent, the euro looks all set for a dying swan-like performance so there maybe isn't too much reason to sell French wheat either.

I understand all the arguments about large exportable surpluses, the lack of export demand, Russia has a seemingly inexhaustible supply of wheat that they are ready to sell at any price, and that the world is dying a slow & painful death.

All I am saying is that with interest rates at an effective zero rate and output in the US, Europe, Canada etc seen sharply lower in 2009, I'd rather have wheat in the silo than the cash in the bank.

Wheat, it's the new money!