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Weekly Commodity Report 20th May 2019

Sterling is lower than it has been seen since February.  This week saw a firm bounce in new crop wheat with prices somewhere near £6.75/T higher than the close the previous Friday due to the USDA report figures.  The November contract ended the week at £147.25/T with low volumes being traded.  Most of this difference can be explained by currency change with weaker sterling this week due to the latest burst of negativity around Brexit uncertainty.  Old crop prices did not rally as much as new crop,  


Globally, there is little new since the USDA report.  Maize planting has been delayed in the US and this has been noted more by end users than the funds, who moved back from record short positions following the USDA reports.  Prices continue to be depressed for all commodities by continued lack of progress and clarity on the state of the US/China trade discussions.  US farmers are starting to consider crop insurance pay-outs and extended final planting dates due to concerns that there is no other option.  Russia reports favourable rain strengthening its position for the coming season with predications that this crop will be the second biggest recorded and Germany revised it 2019 crop estimates up by 19.8% for wheat to 24.3 Mln T. 


US soya bean and meal continued downward this week.  As mentioned above, the key US story is the delay in maize planting.  The important factor this year is that the standard response of more soya beans seems to be off the table with already high end stocks, a continuing trade dispute with China and African Swine Flu all taking away options for the soya market in the US.  China’s soya bean planted acreage is expected to increase by 10% this year to decrease their reliance on outside stocks.  The US export figures are below both 5 year averages and targets set by the USDA forecast.  94,000T of further sales would be required every week to reach the USDA forecast.  Trump has promised further aid to farmers, with $15-20 billion the expected figures.  Currently expectations are that soya beans will receive a $2 per bushel payment with 10 cent per bushel payment for maize.  Renewed tension between China and the US is now increasing the chance that much of the soya bean China promised to purchase from the US will remain in the US.  Despite the gloomy perspective, short covering by funds continues since the last USDA report as the pressure to have a position for the next crop year overrides the long seen lack of decision making that has become a norm for this crop year.  South America continues to see good premiums on the back of continued selling to China. 

How would you like £1,750 prize money and a trip to France?  Well here is a chance for both those things.  A village in France is offering prize money for anyone able to uncover the meaning of a 230 year old rock inscription.

The message includes 20 lines written in both French and Scandinavian characters, and was discovered in a cave five years ago.  Some of the characters seem to be carved in reverse or upside down.  The one meter tall rock can only be reached when the tide is out.  So far the message has not been de-coded yet, so wild theories are believed by the locals in Plougastel-Daoulas inn north west France such as long forgotten languages and that the person who wrote the words was only semi-literate.  The rock also features an image of a ship and a sacred heart (a heart covered by a cross) and the dates 1786 and 1787 place this inscription to just before the onset of the French Revolution.

The competition runs until November and I would expect competition will be high so if you are due a holiday and fancy your chances get translating!

The video is in French but I am guessing if you are going to win that will not put you off.

Brought to you by Melanie Blake and Martin Humphrey.