EU Wheat Close

Posted by Nogger - a legend in his own mind at 16:19 | Categorized as

29/09/11 -- EU grains finished mostly lower again with Nov London wheat down GBP0.85/tonne to GBP156.40/tonne and Nov Paris wheat falling EUR0.25/tonne at EUR190.75/tonne.

The German parliament approved the expansion of the EU bailout fund by a large majority, the bill needs ratifying by the upper house tomorrow. As one problem gets resolved another one inconveniently pops up. A letter from the ECB sent to Italian PM Berlusconi in August calling for "pressing action" to introduce swingeing austerity measures by the end of the month, ie tomorrow, has been leaked to the press there.

A EUR6.9 billion auction of ten year Italian bonds today saw yields increase from 5.22% last month to a pretty unsustainable 5.86% this time round.

Egypt bought 120,000 MT each of Russian and Kazakh wheat in today's tender. The latter has announced that it aims to export 1 MMT of grains per month for the remainder of the 2011/12 season.

The HGCA say that the UK wheat harvest is 98% complete and that yields have averaged 7.5-7.7 MT/ha, implying a crop of 15.0-15.4 MMT off a planted area of 2 million hectares, up 0.2-0.6 MMT on last year.

Winter barley has averaged 6.1-6.2 MT/ha and spring barley 5.3 MT/ha, they say. That implies a UK barley crop of around 5.2 MMT this year, similar to last season.

With the OSR harvest averaging a hefty 3.7-3.8 MT/ha UK farmers may have brought in a crop as high as 2.7 MMT using Coceral's planted area estimate of 720,000 ha, potentially beating last season's record crop by almost half a million tonnes.

All three totals beat the current USDA estimates which are 14.8 MMT, 5.0 MMT and 2.4 MMT respectively.

Looking ahead to next year an estimated 30-40% of winter wheat has been drilled and 20-25% of winter barley, the HGCA add.