EU Wheat Trading Sideways

23/09/13 -- EU grains closed mixed, but mostly a little firmer in more sideways trade. Nov 13 Paris wheat hasn't been more than EUR1.50/tonne higher or lower at the close of any session this month, and today was no exception.

Nov 13 London wheat settled GBP0.30/tonne firmer at GBP152.00/tonne, whilst Jan 14 was GBP0.45/tonne higher at GBP154.45/tonne. Nov 13 Paris milling wheat rose EUR1.25/tonne to close at EUR187.00/tonne. Nov 13 Paris rapeseed was down EUR1.00/tonne EUR362.00/tonne.

Chicago wheat is trying to follow the seasonal trend higher, Friday's Dec 13 CBOT close was the highest for a front month on the weekly chart in 7 weeks. Falling corn prices however are a limiting factor.

Paris wheat remains supported by the strong early pace of EU exports in 2013/14, and ideas that some of the cheaper Eastern European and FSU countries might run short of quality wheat by the new year.

Russia is one such country with quality issues, although they may well end up harvesting more wheat in total than the current USDA forecast of 54 MMT. Their harvest stood at 45.2 MMT off 71.8% of the crop area as of Friday. Yields to date are averaging 2.51 MT/ha, up 35% on a year ago and are now actually a little higher than they were at this point in 2011 when final production came in at 56.2 MMT.

They've also harvested 14.2 MMT of barley off 78.5% of the cropped area, along with 1.2 MMT of corn (off 10.5%) and 1.7 MMT of sunflower seed (off 11.1%).

Too much rain has been Russia's problem. Rain makes grain they say however, even if it's sometimes responsible for low quality. The same seems to be true in Kazakhstan where the Ag Ministry have stuck by a grain production forecast of only 15 MMT all summer. That was apparently nudged up to 16.3 MMT a week or so ago, although official confirmation of that seems to have passed me by. They've now revised that estimate up to 18.5 MMT with the harvest currently standing at 14 MMT off 71% of the planned cropped area.

The Kazakh Ministry have also raised their export estimate from 7-8 MMT all summer to 9 MMT and now 9.5 MMT.

Ukraine say that they've exported 5.27 MMT of grains so far this season, a 14.4% rise on a year ago. Wheat accounts for 3.1 MMT of that, along with 1.6 MMT of barley and 0.6 MT of corn.

The mothballed UK bioethanol refinery Ensus is expected to be back in production soon, according to a report on There's plenty of old crop/imported wheat to use, Defra today estimated 2012/13 UK wheat ending stocks at 2.19 MMT, a 46% rise on the previous season.

Wheat harvesting is imminent in the southern hemisphere. There are stories that Brazil's Parana state lost a third of its wheat crop, almost 1 MMT, to heavy rains in May followed by a series of frosts in the Jul/Aug period. The Argentine crop is shrinking for a second year due to dryness. Australia's crop however is looking good following life saving rains in August and September. ABARES forecast the wheat crop there at 24.467 MMT, up 11% on last year. The Australian barley crop is seen 13% higher at 7.673 MMT.