EU Wheat Extends Recent Gains

EU wheat markets added to their recent gains Thursday, with Nov London feed wheat ending GBP2.50 higher at GBP109.75/tonne, and Nov Paris milling wheat up EUR2.75 at EUR148.50/tonne.

Paris corn was also sharply higher for a second day with Nov posting gains of EUR2.75, and Nov malting barley up EUR3.25/tonne.

Nothing can go down forever, and it seems that the speed and severity of this week's price spike has caught a few complacent shorts by surprise.

Reports are slowly filtering through that very early yields in various parts of Europe are disappointing.

With the Russian grain crop getting sharply downgraded in size this week, plus concerns over unplanted acres in Canada and drought hurting wheat in Kazakhstan it appears that final production numbers for 2010 are likely to be lower than current official estimates.

Quality looks like being an issue in some places too, like flooded eastern Europe and many parts of the Midwest where disease, mould and vomitoxin are being reported.

Whilst the recent heatwave in northern France and the UK may have taken the top off yields, hopefully it will have added something to the quality of this year's crop, which would be refreshing.