More bad news for international sorghum values as China decides to subsidise domestic corn consumption to help clear massive stockpiles. The subsides are expected to assist ethanol producers ramp up production. In the northern provinces the subsidy could equate to as much as 200 Yuan / tonne, which is roughly $40 / tonne.
The subsidy could decrease import parity prices on corn and as corn will displace other products into domestic markets in China we may well see imported feed grain demand in general decline. The flip side is once the Chinese ethanol market ramps up longer term we may see a significant increase in global corn consumption, so potentially sort term pain for long term gain.

Reading through the wires this morning I was amazed to see a link between the FBI announcement that it will reopen the probe into Hilary Clintons emails and a decline in US soybean prices, I mean seriously guys, do you sit around the table in the morning after a bender and try and think up obscure reasons for simple profit taking.

Rain across the US wheat belt was seen as bearish while rain across the Brazilian wheat harvest and parts of Australia was seen as a positive to prices. Light rain across parts of the Ukraine and Russia was also seen as beneficial for the winter wheat sowing.