EU Grains Close

03/08/11 -- EU grains finished with Nov London wheat up GBP3.00/tonne to GBP164.00/tonne and Nov Paris wheat EUR3.75/tonne higher at EUR199.25/tonne.

European markets were playing catch-up today from a sharply higher close in US wheat futures last night and a limit up finish on corn.

Things weren't as steady as they might have been however with concerns over European (and US) debt still hanging over the market.

All in all, EU prospects look far better than what was expected a few months back.

Recent weather conditions have stalled the mainland EU wheat harvest, with cutting in Germany at around halfway. Final output there is seen falling modestly from around 24 MMT to 23 MMT in 2011.

The weather has also improved this past few days in France, allowing harvest progress to resume, with a soft wheat crop in the region of 33 MMT expected versus 35.6 MMT last year.

UK wheat harvesting is only 5-10% done and early quality reports are very promising, final output may come in at around 14.5 MMT, a 2% drop on production last season.

Russian and Ukraine cereal output this season looks like being well ahead of current USDA projections, as too do exports. Russia exported a record volume of grains for the month in July and is expected to ship out it's highest ever monthly total in August.