The only people the news that Russia do not intend to limit wheat exports came as a surprise to were the punters on the world futures markets who started the rumour in the first place.
Longer term the Russian S&D sheet does appear to have a few discrepancies but until we see the Russians come out with some kind of confirmation that it is a problem and may affect the volume of domestic milling wheat they are happy to carry over, it will probably just remain a rumour that the punters pull out when they need to close a few shorts.
Russian milling wheat, at least on the export front, continues to drop in price and was offered at US$219.75 FOB yesterday. This is a fall of roughly US$16 over the last five weeks. The buyers are watching the FOB offers fall away and continue to buy hand to mouth.
With the world wheat S&D at its tightest in six years one does get the feeling that the excrement and the fan are getting closer together.
In the USA wheat futures were hit hard from the open and never really recovered. The stronger US dollar was also a bearish factor to US values. The US dollar continues to firm as pressure on world markets finds the punters happy to park money in the USA. The hint of further rate rises in the states as opposed to sideways rates in other markets is also attracting US dollars back to the USA.
Weakness in the AUD was found from an increasing account deficit and lower metal prices….will my BHP shares ever go up.