US Wheat Associates first price report for the new year highlights.
For the week SRW nearbys at the CBOT were up 47 cents/bu, the KCBOT rose 32 cents and the MGE finished up 53. Corn gained 15 cents/bushel this week and soybeans were up 41 cents.
Duties and trade quota changes
This week, China imposed export quota restrictions and a tax on flour exports following the decision last month to end subsidies on grain and oilseed exports.
India abolished its 36% duty on flour imports and the Argentine export registry remains closed.
Ocean freight rates saw a sharp break this week with the Baltic Dry Index falling to a 3 month low on slack demand during the holiday season. Pacific rates are off 40% from late October highs though still 60% higher than January 2007. Rates in the Atlantic are down 17% from October and 90% higher than last January. (see chart of the BDI and price of gold)
The dollar continued to fall against the euro and other currencies this week on negative U.S. manufacturing and jobs data increasing the probability of another interest rate cut by the Federal Reserve this month. The euro is at $1.48 while the Canadian dollar is trading above the U.S. dollar.
Important news expected
Next Friday, January 11, USDA will release several important reports including estimates of grain stocks held in the country, U.S. winter wheat seedings, the monthly World Agricultural Supply and Demand Estimates, as well as a final crop production assessment.
Here is a chart of the Panamax index (Ships classified as Panamax are of the maximum dimensions that will fit through the locks of the Panama Canal. ) for comparison - shipping rates have peaked in mid October.