The Chinese negotiation saga continues – last week’s meeting in Washington DC was the meeting before the meeting – the October meeting is being billed as the one that will provide the direction. The market didn’t really get a read on the pre-meeting but another 10 cargoes of beans sold to China have renewed hopes that “this time for sure, Rocky”. It’s a strange situation given the debate over the demand erosion associated with the African Swine Fever – continued reports of massive hog losses coupled with an expanding footprint of infection suggest that feed demand has only one way to go. However, the numbers tell a different story. Implied meal offtake in China is not suggesting the level of impact that many fear – in fact, with margins wide open it’s logical to see the Chinese hog farmer getting busy to capture this once in a lifetime opportunity. But we will continue to debate this given how opaque the data from this region can be.

The spring wheat woes seem to be going from bad to worse – the last 30 per cent of harvest seems destined to be downgraded to feed at best with a bunch of snow now forecast. While an issue for HRS, magnified by the fund short, the Canadian situation could have far reaching implications. In the areas most adversely affected by the latest unseasonal conditions there is >70pc of harvest still to go. Discounted high protein wheat maybe unsuitable for human consumption but maybe perfect for an offshore starch manufacturer – especially with a sizable discount to competing grain located closer to the plant.