EU Grains Closing Comments

November London wheat closed GBP2.25 lower at GBP126.75/tonne; November Paris wheat ended with losses of EUR4.50 at EUR168/tonne.

Paris corn and rapeseed were also sharply lower, although malting barley managed to post modest gains.

Reports from the Continent suggest that the barley harvest is already starting to wind down in some places, with yields generally not as good as last year and just "average" to slightly disappointing overall.

The grain harvest in Ukraine remains well behind schedule at just over 8 MMT compared with 11.5 MMT a year ago. Wheat yields are averaging 2.7 MT/ha, with barley yields coming in at 2.25 MT/ha.

It was another very hot and largely dry weekend in Russia, where the harvest is already well advanced and yields very disappointing. After two years of bumper grain harvests - 108 MMT in 2008 and 97 MMT in 2009 - output is set to be lower than consumption this year.

Quite heavy rain is forecast for the west and north east of England tomorrow, although the breadbasket south east should escape the showers, with temperatures rising as high as 29C.

Egypt are rumoured to be in the market tendering for wheat again this week, they could be in for quite a shock compared to the prices they have been paying of late. At least the freight market has gone in their favour.

Iraq bought 350,000 MT of Romanian, Australian, Canadian, Russian and US wheat over the weekend.