Morning Ramblings

The USDA are out at 13.30 GMT with their usual weekly export sales report. For wheat estimates range from 450,000 to 650,000 MT. Last week's sales at 886,300 were a marketing year high. Also being scrutinised today will be the size of actual shipments, these need to average 500,000 MT/week for the remainder of the marketing year to hit the USDA's export target of 825 million bushels, or 22.5 MMT.

For corn export sales are forecast to range between 800,000 and 1,050,000 MT, last week's sales were 1,610,800 MT. For soybeans export sales estimates range from 700,000 to 900,000 MT. Last week's sales were 990,500 MT.

The overnight markets are up a tad, in what can probably be attributed to a slight correction after recent steep declines, rather than a fundamental change of direction. Relief is also a factor, after last night's Obama State of the Union address didn't come down too heavy handedly on US banks. Soybeans are currently around 5 cents higher, with wheat and corn up around 3 cents apiece.

Japan has bought 127,000 MT of wheat in a routine tender, of that 86,000 MT will be US origin. Nobody is fooling themselves however that the recent price decline is throwing up all sorts of buying interest for US wheat. Egypt passed again in favour of Russian grain last night.

Egyptian consumption of wheat could rise by around 2.5-3.0 MMT by 2015, as the population increases, according to a government official. That could push imports up by already the world's biggest buyer by a similar amount, no wonder everybody is fighting to be their new best mate.

Argentine farmers may well plant significantly less wheat for next season, 2010/11, than the current lowest in more than 100 years acreage, according to the Rosario Grain Exchange. That would undoubtedly push production below the current level of domestic consumption. The move would effectively be a protest vote from the nation's farmers, against government restrictions on exports.

In addition that could potentially turn Brazil to look to the rest of the world for more of it's needs next year, or plant significantly more wheat themselves.

Has anyone pressed the big green button at Ensus yet? Nobody seems to know, or if they do they aren't telling me. It doesn't look like it judging by front month London wheat down another GBP1.25/tonne this morning.

Another thing that nobody seems to know is what is the latest on the similar-sized Abengoa wheat refinery in Rotterdam? When is that going to be up and running? And have they got their own button, or are they sharing one with Ensus?

Answers on a postcard please.