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October 15, 2010

(See attached file: PR 101015.pdf)(See attached file: PR 101015.xls)

Highlights:
  • Wheat prices fell this week as traders locked in profits from last Friday’s strong gains. The CBOT December contract fell 14 cents, to $7.04/bu. KCBT nearby prices lost 13 cents, to $7.45/bu, while MGEX fell 10 cents, to $7.54/bu. CBOT corn and soybean prices were stronger again this week, gaining 34 cents and 50 cents, respectively. Corn prices continued to rally following USDA’s report last week, closing at $5.63/bu on Friday. The Environmental Protection Agency approval of an ethanol blend of 15 percent in automobiles dated 2007 and newer added support. Strong demand for soybeans, especially from China, pushed soybean prices to a 14-month high, with CBOT nearbys closing at $11.85/bu.
  • French analyst Strategie Grains increased their 2010/11 EU wheat crop estimate by 1.0 MMT, pegging the total crop at 136.7 MMT. The increase was primarily due to improved yields in Germany, Poland, and the United Kingdom. Strategie Grains estimated ending stocks at 9.0 MMT, down from 13.0 MMT a year ago.
  • The Buenos Aires Grain Exchange said on Thursday that the 2010/11 Argentine wheat crop could reach 12.0 MMT with some additional rain. The Exchange said the crop would reach a minimum 11.3 MMT. USDA currently estimates Argentina’s wheat production this year at 12.0 MMT.
  • Conditions in Western Australia (WA) remain extremely dry. CBH Group, a Western Australia grains merchandiser, pegged this year’s WA wheat crop at 3.9 MMT, down from 8.2 MMT in 2009/10. The Australian Bureau of Agricultural and Resource Economics’ current estimate, released in June, stands at 8.0 MMT.
  • The SRW/corn spread fell to $1.41/bu this week, its lowest point since the end of June. The spread has narrowed considerably, from a peak of nearly $4.00 in early August, due to the recent rally in corn prices.
  • The Dollar Ice Index continued to slide this week, reaching a one-year low on Thursday at 76.96. On Friday, the index stood at 76.98, down from 77.25 a week ago. The dollar hit a new 15-year low against the Japanese yen, while the Australian dollar reached parity against the U.S. dollar for the first time since flotation in1983.
  • The Baltic Panamax Index was softer again this week, falling 6 percent from last week to 2,254. Maritime Research’s Grain Freight Index gained on the week, climbing to 569.2 from 555.2 a week ago.

File Name
PR 101015.pdf
PR 101015.xls
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