EU Wheat Closing Comments

EU wheat futures closed flat to mostly lower with Mar London wheat ending down GBP0.90 at GBP100.25/tonne and Mar Paris wheat unchanged at EUR125.75/tonne.

London wheat was lower across the board as sterling rose above 1.15 against a beleaguered euro, only another very poor showing from the single currency prevented all Paris contracts from also ending in negative territory too.

Front month January London wheat closed below the psychologically important GBP100/tonne mark for the first time since the September lows were set. Front month March Paris wheat also came close to breaking through EUR125/tonne, but fell just short.

Export interest remains scant however, and whilst prices are falling at the current rate who can blame buyers from staying away from the market?

Despite seemingly mopping up just about every tender going at the moment, Russian wheat exports are actually running behind last season's pace halfway through the marketing year.

Crop conditions in Ukraine are lagging last season, and development is also two to three weeks behind schedule. Current low prices and lack of credit may also discourage farmers there from upping inputs, which may further reduce yield prospects for the 2010 harvest.