London Wheat Posts Fourth Day Of Record Highs

08/11/12 – EU grains closed mostly firmer, but off session highs, after May 13 London wheat earlier managed to set a record high price for any London wheat position ever for the fourth day in a row.

Nov 12 London wheat ended GBP0.50/tonne higher at GBP221.25/tonne, with benchmark May 13 finally finishing only GBP0.15/tonne firmer at GBP226.50/tonne, having earlier hit a record GBP229.00/tonne. New crop Nov 13 also pushed on towards the GBP200/tonne mark, ending the day GBP1.25/tonne firmer at GBP194.75/tonne.

Across the Channel, Nov 12 Paris wheat ended EUR2.25/tonne higher at EUR278.25/tonne and Nov 13 also posted net gains of EUR2.25/tonne to end the day at EUR248.25/tonne.

FranceAgriMer trimmed their forecast for 2012/13 soft wheat production there from 36.0 MMT last month to 35.8 MMT, with yields cut from 7.39 MT/ha to 7.35 MT/ha.

A Bloomberg report suggested that 20-25% of Russian winter grains are already at risk of being lost, having so far failed to emerge ahead of dormancy due to the ongoing drought that slashed this season’s cereal production. The worst affected areas are the in Krasnodar, Rostov and Stavropol region, normally Russia’s top producing districts.

Meanwhile US wheat too is at risk, entering winter dormancy poorly established, whilst plantings in the UK, France, Germany and Poland are also late and much of what has been sown is in far from ideal condition.

MDA CropCast left their Argentine and Australian wheat production estimates unchanged from last week at 10.64 MMT and 20.62 MMT respectively. Both are considerably lower than the USDA’s figures of 11.5 MMT and 23.0 MMT which are up for revision on tomorrow.

A Reuters survey of ten analysts placed the Australian wheat crop slightly lower at 20.47 MMT, over 30% down on last year.

CONAB cut their forecast for Brazil's wheat production this year to just 4.46 MMT versus a previous estimate of 5.0 MMT and 23% down on last year.

The USDA is expected to trim 2012/13 world wheat ending stocks from 173 MMT to around 171 MMT in tomorrow's report.

Both the BOE and the ECB left interest rates unchanged at home and in the eurozone.