Wheat Comment 10-20-09

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Wheat Morning Update & Commentary Wheat continues to move higher, forcing shorts to take cover. Wheat should be supported by both Corn and Soybean markets that seem intent on seeking out higher prices, with harvest not close to being home yet. Despite the decline in the Dollar, US Wheat is still not as competitive as Black Sea origin. Japan's Ag Ministry announced their weekly Thursday tender they're seeking 133,000 mt of Wheat from US/Canadian and Aussie origin. Glencore was the reported seller of 300,000 mt of Wheat in an Algerian tender that closed late last week. The price was reportedly $209/mt cif. Oct 26th is bid deadline for 100,000 mt plus Wheat tender floated by Iraq's Grain Board. Egypt hopes to improve self-sufficiency on wheat, currently the nation is 55%, and their target is 75% by 2020. In the U.S. approximately 69% of the US winter wheat crop has been planted up from last week's 64% and long term average plantings of 78%. 48% of the Winter Wheat crop has emerged, up from the prior week's 39%. A year ago at this time 56% has emerged, while the long term average is 54%. HRW basis is flat while freight remains firm. SRW Basis remains flat with a full pipeline overhanging the market. The prospect of a better-than-expected Australian wheat crop appears to have faded after extreme weather in grain-growing regions occurred over the weekend. Grain analysts said frosts in the east of the country and a heat-wave in the west could make it ...

Informations

• Publié par: Orgie
• Nombre de lectures: 11
• Langue: English

Extrait

http://www.linngroup.com

Page 1 of 2

312.896.2001

Reproduction or rebroadcast of any portion of this information is strictly prohibited without the written permission of the Linn group, inc. the information reflected herein is derived from sources believed to be

reliable; however, this information is not guaranteed as to its accuracy or completeness. Opinions expressed are subject to change without notice. this material and any view expressed herein are provided for

informational purposes only and should not be construed in any way as an inducement to buy or sell commodity futures or options contracts. The Linn group and its officers, directors, employees and affiliates

may take positions for their own accounts in contracts referred to herein. Trading futures involves risk of loss. Past performance is not indicative of future results.

Wheat Morning Update & Commentary

Wheat continues to move higher, forcing shorts to take cover. Wheat should be supported by both Corn

and Soybean markets that seem intent on seeking out higher prices, with harvest not close to being home

yet. Despite the decline in the Dollar, US Wheat is still not as competitive as Black Sea origin. Japan's

Ag Ministry announced their weekly Thursday tender they're seeking 133,000 mt of Wheat from

US/Canadian and Aussie origin. Glencore was the reported seller of 300,000 mt of Wheat in an Algerian

tender that closed late last week. The price was reportedly $209/mt cif. Oct 26th is bid deadline for

100,000 mt plus Wheat tender floated by Iraq's Grain Board. Egypt hopes to improve self-sufficiency on

wheat, currently the nation is 55%, and their target is 75% by 2020. In the U.S. approximately 69% of

the US winter wheat crop has been planted up from last week's 64% and long term average plantings of

78%. 48% of the Winter Wheat crop has emerged, up from the prior week's 39%. A year ago at this time

56% has emerged, while the long term average is 54%. HRW basis is flat while freight remains firm.

SRW Basis remains flat with a full pipeline overhanging the market. The prospect of a better-than-

expected Australian wheat crop appears to have faded after extreme weather in grain-growing regions

occurred over the weekend. Grain analysts said frosts in the east of the country and a heat-wave in the

west could make it difficult to see the 2009/10 harvest hit the top range of forecasts. Ag business group

in Ukraine sees the 2010 Wheat crop in a range of 13-14 mln mt down from this season's estimated 20

mln mt crop due largely in part to drought conditions

Overnight markets had a somewhat subdued Sunday evening with Chicago closing up 7 3/4 cents on

2264 contracts. Kansas City finished overnight trade up 8 1/4 cents and MPLS closed up 7 cents. Kansas

City/Chicago spread is trading at 12 1/4 cents. The MPLS/Chicago spread is at 27 cents. Euronext

(Matif) Milling Wheat continues to gain with a last trade at $5.16/bu USD in the Nov.

Globex Overnight

Contract

Last

Net Change

High

Low

Volume

ZWZ9

518^0

0^2

525^0

516^4

3676

ZWH10

535^6

-0^6

543^0

535^0

367

ZWK10

548^0

0^0

554^0

548^0

86

ZWN10

559^4

0^6

565^0

558^2

175

KEZ9

528^0

-0^6

534^6

527^4

549

KEH10

543^4

-0^6

550^0

543^4

94

MWEZ9

541^0

-0^4

549^4

539^0

190

MWEH10

556^0

-1^4

559^2

556^0

17

Early Opening Calls: steady, better

Top News

-- Ag business group in Ukraine sees the 2010 Wheat crop in a range of 13-14 mln mt down from this

season's estimated 20 mln mt crop due largely in part to drought conditions

http://www.linngroup.com

Page 2 of 2

312.896.2001

Reproduction or rebroadcast of any portion of this information is strictly prohibited without the written permission of the Linn group, inc. the information reflected herein is derived from sources believed to be

reliable; however, this information is not guaranteed as to its accuracy or completeness. Opinions expressed are subject to change without notice. this material and any view expressed herein are provided for

informational purposes only and should not be construed in any way as an inducement to buy or sell commodity futures or options contracts. The Linn group and its officers, directors, employees and affiliates

may take positions for their own accounts in contracts referred to herein. Trading futures involves risk of loss. Past performance is not indicative of future results.

-- Glencore was the reported seller of 300,000 mt of Wheat in an Algerian tender that closed late last

week, acc. to traders.

The price was reportedly $209/mt cif

-- +

The ag ministry claims they're only 55% suficient.

-- Japan's Ag Ministry announced their weekly Thursday tender they're seeking 133,000 mt of Wheat

from US/Canadian and Aussie origin

-- Oct 26th is bid deadline for 100,000 mt plus Wheat tender floated by Iraq's Grain Board on Tuesday,

acc. to their website.

-- 30,000 mt EU origin feed Wheat is being sought in an Oct 22nd tender floated by private group in

Israel

-- Approximately 69% of the US winter wheat crop has been planted up from last week's 64% and long

term average plantings of 78%.

-- Latest weekly USDA data shows 48% of the Winter Wheat crop has emerged, up from the prior

week's 39%. A year ago at this time 56% had, while the long term average is 54%.

-- Monday's USDA Weekly Wheat Inspections: 18.627 mln bu ; expected 18.5 mln bu

-- Pending Tender: Oct 22nd is bid deadline in 200,000 mt Wheat buy tender floated by Morocco's state

grainary.

Delivery is expected by December 15th, acc. to traders

-- Pending Tender: Japan's Ag Ministry also floated Oct 29th SBS tender for 52,200 mt of food grade

Wheat

-- Pending Tender: 60,000 mt of optional origin Wheat is sought by Bangladesh's gov't in a November

16th tender deadline

-- Pending Tender: A new 100,000 mt of Wheat tender for Dec 2nd was issued by Bangladesh state run

grainary, acc. to traders

-- Liffe Nov milling wheat futures were +0.75 euro better at 128.25 euros/mt.

-- Globex Wheat Vol. 53,076; Pit Vol. 3,380; Open Interest Change: + 1,109

-- Weather: 6-10 day Forecast: Below Normal Temps. Normal to Above Precip.

-- Outside markets: Energy Complex -0.23 at $79.38; Gold & Silver: +5.7 at $1063.7 & +0.110 at

$17.735; US $ -0.095 at $75.410

Cash Markets

-- CIF SR Wheat steady off 5: Oct. -30 to -?? Nov. -10 to +10 Dec. -10 to +15

--

John Christopher

Linn Group

312.896.2061