EU Wheat Closes Higher Following CBOT

EU wheat futures closed higher Friday following US markets higher and also paying heed to sharply lower production prospects out of Eastern Europe.

Paris November milling wheat was up EUR1.75 at EUR158.50/tonne, and London November feed wheat was up GBP2.35 at GBP131.00/tonne.

Production across Eastern Europe is seen sharply lower this coming season on a combination of lower plantings, drought, frost and reduced inputs.

From the Black Sea across Romania, Hungary, Bulgaria and into Poland winter wheat seedings have been badly affected by all these problems, but the trade seems to have taken a while to waken up to exactly how bad things are.

Severely delayed spring wheat plantings in the US, and an almost unimaginably bad 16-month long drought in Argentina is slashing world production by the day.

Suddenly agri-commodities are the thing to be in, outstripping almost every other sector. They were the first to die a death, and look set to be the first to recover from the economic malaise of 2008.

With London wheat futures tonight closing with a GBP11.50/tonne July/Nov carry, bring it on, wheat is the new money!