EU Wheat Closing Comments

November London feed wheat closed GBP1.25 higher at GBP103.00/tonne, with November Paris milling wheat up EUR1.25 at EUR140.00/tonne.

Reports suggest that early winter barley harvesting has now begun in Ukraine, but suddenly it's not all doom and gloom.

In the UK wheat exports were robust again in April, according to figures released today, with 279,000 MT departing for mostly EU-27 destinations. That leaves us well on target to match or even exceed Defra's export target of 2.3 MMT for the current 2009/10 marketing year.

The association of German farming cooperatives, DRV, pegged the 2010 German wheat crop at 24.98 MMT, with rapeseed production seen at 5.8 MMT and barley output 10.6 MMT. Production in 2009 was 25.2 MMT, 6.3 MMT and 12.2 MMT respectively.

Saudi Arabia entered the market with a tender to buy almost a million tonnes of wheat today. No matter who wins it, at the very least that will potentially absorb some of the weighty surplus that has been depressing prices of late.

Heavy rains have stalled the US winter wheat harvest just as it was attempting to get going in Kansas. What has been harvested further south is generally low in protein. Premiums for high protein wheats have leapt from a norm of 10-15 cents/bushel to 50 cents plus over 11% samples.

EU rapeseed futures have been moving steadily higher for most of the year, aided by strong demand and a weak euro. Canadian futures have also moved sharply higher in the past week or so on reports of large enforced reductions in acreage. That has fuelled further considerable price rises here in Europe.