EU Wheat Close

03/02/11 -- EU wheat futures closed mostly higher with Mar London wheat GBP0.50 higher at GBP206.00/tonne, and Nov up GBP1.20 to GBP175.45/tonne. Paris wheat closed with Mar up EUR2.75 to EUR275.75/tonne and Nov climbing EUR3.25 to EUR238.25/tonne.

It was another decent performance from London wheat, which was trading lower mid-afternoon after Chicago opened, in the wake of the pound rising above 1.62 against the dollar and trading up to 1.1850 against the euro.

The situation in Egypt seems to be going from bad to worse, with the country rapidly grinding to a halt. The ports are shut, and although the authorities say that this will only be for a day or two, we don't really know how much longer they will be the authorities.

The USDA announced quite disappointing weekly export sales under the circumstances, at 565,400 MT that was well below expectations for sales of 800 TMT-1.1 MMT. Despite their problems Egypt accounted for 140,200 MT of that total.

Brussels issued soft wheat export licences of 346,000 MT this week, up 60% on last week's total of 240,000 MT.

After a largely dry week or two, welcome heavy rain is sweeping into Ireland and the UK over the next couple of days. That might help new crop wheat here, the question is will we have enough old crop left to last us through until then?

Elsewhere in Europe "an expanding area of dryness in central France is a growing worry, most of continent is dry in the 7-day forecast," say Martell Crop Projections.