EU Wheat Ends Sharply Lower On Bearish US Data

EU wheat futures closed sharply lower Tuesday after the USDA released an almost unbelievable set of bearish planting data, sending US futures crashing lower.

Paris November milling wheat closed down EUR4.25 at EUR139.50/tonne, and London November feed wheat closed down GBP3 at GBP112.50/tonne.

The USDA June acreage report stunned the market by increasing planting estimates for corn, wheat and soybeans from their previous forecasts in March.

Exactly how they can manage to find around a million acres more wheat, one and a half million more soybeans AND two million more corn seems questionable, but find them they did.

In London November feed wheat opened GBP1/tonne higher but crashed as much as GBP5/tonne lower in the aftermath of the USDA figures.

The US harvest is progressing well, with expectations that it will all but wrapped up in Oklahoma by the weekend, and move from southern Kansas into the northern half of the state.

Harvest pressure is on the cards for Europe too, with barley cutting in Germany expected to begin this weekend.

Still, I guess it should come as no major surprise that we see the market down at this time of year. Even so the magnitude of the drop witnessed during one month is severe.

In London November feed wheat hit GBP134/tonne on June 1st, and has set a monthly low of GBP110.50/tonne today, making for a drop of 17.5% or GBP23.50/tonne in just over four weeks.

A pretty impressive slump by any standards.