Weekly Grain Digest - 13th June 2018

The COFCO UK Weekly Digest brings together a wealth of global grain intelligence to summarise this week's market drivers for grains and oilseeds.


Southern Russia remains hot and dry
Sterling volatility
US / China trade war tariffs
Market View:
Volatility has been the story of the week as markets struggle to balance the current key drivers of weather and global politics. Markets continued to be impacted by effect of the US-China trade war earlier in the week. Chicago dropped around 5% to the weeks low on Tuesday before recovering during the latter half of the week moving back up to levels seen the previous week.

Weather markets have stepped back recently as conditions across the world show few changes. However, markets have struggled to move much lower as the South West Plains remain hot and dry which is also true in Southern Russia and the Black Sea. Although the market has dropped from recent highs it has recovered later in the week.

Sterling also showed volatility this week. The likelihood of an interest rate rise was increased following a Bank of England vote which firmed sterling before weakening back later in the week to sit in the middle of its range at circa 1.1400 v’s the Euro.

Looking forward we will continue to analyse global weather patterns to see if the bullish trend continues, though we may need a fresh weather stories to take us to new highs. Although its near impossible to predict, the US – China trade war will impact market indefinitely until the situation stabilises.


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