EU Wheat Closing Comments

EU wheat futures closed mixed, mostly a little steadier, with March London wheat up GBP0.30 at GBP93.50/tonne, and Paris March milling wheat up EUR0.25 at EUR122.75/tonne.

A strong dollar and spillover support from a steady Chicago market on Monday night helped support wheat futures today, as did a continued lack of farmer selling.

However, as the day wore on the dollar began to decline and wheat in the US opened lower, taking most of the shine off early gains.

Consumer demand is slack, and export interest is pretty stagnant too, save from last weeks one 60,000 MT cargo sale of French wheat to Egypt at USD170/tonne. Russia remain the dominant force in the export markets, and that is unlikely to change any time soon as they look to offload some of their intervention stocks at subsided levels.

There's not much interest in barley either. Over 1 MMT of the grain has already been put up for intervention in Germany, and more than 750,000 MT in France, according to German barley offers into the support program are likely to swell to 1.5 MMT before intervention ends in the summer, they say.

Meanwhile an EU wheat crop some 5 MMT higher than last years production is emerging from winter dormancy.

Things might get worse before they get better.