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| Agree with your comments on basis and freight. I was taking the perspective of being at the destination. I should have said the price of destination permiums or basis move in the same direction as freight. But let me share a bit more. The end users in Yemen, Egypt or where ever actually call the grain majors...The majors either offer this grain against grain they own or short the basis against grain they expect to buy. This quickly travels down the system and can move the basis in a specific area given the quality and etc of what traded and the position of the trading company before and after the sale. For example, Here is what was offered to Egypt 2 nights ago from US. This in fact did raise destination US Gulf HRWW values a dime. If your elevator may have backed the trade to one of the majors who made the sale and given that the market is at a carry I am certain that the bids would be pushed. Please find below Egypt Gasc Wheat & freight tender line up for today Sept 22, 2010.
Glencore 55000 mt US Spring @ $ 304.90
A1 55- 60000 MT USHW @ $ 311.00 + $ 41.50 Freight
Abu Donkol 55000 mt USHW @ $ 311.00
Venus 60000 mtUSHW @ $ 308.25
L.Dreyfus 60000 mtUSHW @ $ 321.25
And
2X55000 USHW @ $ 306.75
Cargill 55000 MTUSHW @ $ 305.50
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who buys the wheat?
