EU Wheat Mixed, Strong Export Pace Support

16/08/13 -- EU grains closed mixed, with nearby London wheat posting a rare up day and front month Nov 13 snapping an eleven session losing streak by closing GBP1.85/tonne firmer at GBP152.60/tonne and with Jan 14 up GBP2.10/tonne to close at GBP154.85/tonne. Nov 13 Paris milling wheat settled EUR2.00/tonne lower at EUR183.75/tonne.

Despite a firmer close today, this was still a bad week at the office for London wheat, with Nov 13 ending GBP3.60/tonne lower and Jan 14 GBP3.35/tonne easier. Nov 13 Paris wheat managed to gain EUR0.75/tonne during the course of the week.

The French soft wheat harvest moved on to 90% complete as of Aug 12, according to the latest figures from FranceAgriMer. That's almost in line with last year's 91% complete. The spring barley harvest is 84% done, up from 58% a week ago and versus 88% this time last year. Corn silking is at 88% versus 74% last week and 98% last year. The proportion of the corn crop rated good/excellent was left unchanged at 55%.

Strong export demand has supported French wheat this week. Brussels has already issued export licences for 2.65 MMT for the new campaign, nearly double those of this time a year ago. The port of Rouen shipped 158 TMT of soft wheat this week, up 77% on a week previously, with Algeria the top destination taking 128 TMT of that total.

At home, the HGCA say that nationally less than 5% of the UK wheat area had been harvested as of Aug 13. They say that 75% of the winter barley area was harvested, along with 30% of the oilseed rape area as of this date.

The highly varied crop conditions mean (predictably) that yields are all over the place, with wheat yields ranging from 5.5-12.4 MT/ha and winter barley yields at 5.0-11.9 MT/ha, they say. Generally though "Yields to date have been better than expected, with many farms reporting yields above the farm average," they add.

Whilst it's still early days, final wheat yields might come in at around 7.6-7.8 MT/ha, which is in line with the 5-year average of 7.7 MT/ha, they suggest. "The best yields have come from early drilled (September) crops on moisture retentive soils," they note.

The Russian grain harvest meanwhile now stands at 49.5 MMT off just over 40% of the planned cropping area. Wheat accounts for 34.7 MMT of that. That's within 3 MMT of last year's entire wheat crop despite the fact than only 46% of the planned area has been harvested so far. Average yields are still holding up surprisingly well at 3.01 MT/ha, up 38% versus 2.18 MT/ha this time last year. Everything now hinges on how the spring wheat harvest pans out in Siberia. Russian growers have also just begun the harvesting of corn, soybeans and sunseeds.

The Ukraine grain harvest currently stands at just under 32.5 MMT, with almost all the winter and spring wheat and barley now cut. The winter wheat harvest is 22.7 MMT, which along with 430 TMT of spring wheat gives an all wheat crop of in excess of 23 MMT in bunker weight. That suggests a clean weight wheat harvest of around 21.5 MMT this year, up 36% on last year's production.

Ukraine has hit the ground running as far as the new 2013/14 season is concerned, with grain exports so far up 34% on last year, according to the local Ag Ministry.

Kazakhstan gowers are just starting to get stuck into their grain harvest, with 1.16 MMT in the bin so far. Plentiful rainfall in April through to July appears to have really given their crop a lift, with early yields so far up 65% on year ago levels.