EU Wheat Pounded Lower

EU wheat futures were pounded lower from the outset of trading Monday, with November Paris milling wheat ending down EUR1.75 at EUR123.75/tonne, and London November feed wheat trading down GBP1.10 at GBP94.40/tonne.

Paris November wheat set a new contract low, and London November wheat fell to it's lowest levels of the year.

Generally better yields than expected across most of Europe, were backed up by news that even the normally cagey Russian agriculture Ministry had finally admitted that grain production there would come in higher than their previous estimate of 85 MMT.

This season's wheat crop is now expected to come in around 60 MMT, down slightly from last year's 63.7 MMT, but much better than early season estimates of 55 MMT.

The US was closed today for the Labor Day holiday, providing little direction, the pound however was higher which added some bearish pressure to UK wheat.

On the export front fresh orders are few and far between. Egypt booked a combo of French/US and Russian wheat last week, EU wheat export licences are just about matching last season's pace, but it's early days yet and the current pace needs to be maintained for the rest of the marketing year.

Still competition remains from the likes of Russia and Ukraine, and the UK's main export home of Spain seem to have plenty of wheat to satisfy their needs for the time being.