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Southern Hemisphere weather concerns are also supporting wheat prices, with excessive rain in Argentina and Australia, Barclays noted in a report.

01 Dec 2012

Commodity Online
Monday’s weekly USDA crop ratings data showed that 33% of the US winter wheat crop was rated good/excellent, down 1% from the previous week and well below year-ago levels of 52%. Meanwhile, 26% of the crop is rated poor/very poor, up 2% from the prior week and double the year-ago level of 13%.

Southern Hemisphere weather concerns are also supporting wheat prices, with excessive rain in Argentina and Australia, Barclays noted in a report.

Grains prices started the week on a firm note, supported by more positive macro data and USDA export sales data for the week-ending 15 November (released a day later than usual, on 23 November, due to the US holiday) showing strength, especially as corn and wheat export sales came in above expectations, having posted a poor performance so far.

Prices rose further through the week, led by the strength in wheat prices, which rose to two-week highs, underpinned by weather fears.

Corn prices moved higher this week as well with US export sales coming in well above expectations. However, ethanol production continued to trend lower.

The latest EIA data showed that US ethanol output in the week ending 23 November was 803Kbpd, posting a 7Kbpd fall from the previous week.

Price gains in soybeans were muted in comparison but rose due to concerns about South American production (which is being forecast at a record high) and strong export demand for US soybeans and soy oil.


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