SPECIAL UPDATE - Russia
May 28, 2011
I wanted to let everyone know that Russian Prime Minister Vladimir Putin announced that the country will lift its ban on grain exports on July 1st. Remember, the Russian government banned exports of wheat, barley, rye, corn and flour last August after a severe drought and heat wave cut the country's grain production by almost 40%. In my opinion this was the first major domino to tumble in this recent bull-run...lets hope this latest statement to lift the ban isn't the last piece of the puzzle. The Russians are claiming their spring planting is 10% higher than the previous year and that their winter wheat harvest was good enough to lift the bans. Russia’s Agriculture Ministry estimates the total grains harvest may be between 85 million and 90 million tons, up from 60.9 million tons last year.
You know my feelings, I think it is all political, but you have to respect the fact the market may not take kindly to the news of Russian wheat being available once again to the world market. The bulls and bears will fight it out in Monday nights opening, with the bulls continuing to talk about crop production problems in the US, Canada, France, Germany, UK, China and possibly even Russia. The bears on the other hand will be rejoicing in the fact that more global supplies will soon be available form a major producer such as Russia.
I still believe any major breaks this next week should be secured. It may take a few days for the markets to digest the news so be cautious jumping in the waters with both feet early.
Have a good weekend, just wanted to keep everyone updated,
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