EU Wheat Closing Comments

Nov London wheat ended the day GBP1.50 higher at GBP160.50/tonne, unchanged on the week. Nov Paris wheat closed up EUR2.75 at EUR230.50/tonne, down EUR1.50 on the week.

Weekly soft wheat export licences were issued by Brussels for a 2010/11 marketing year record 943,000 MT, with export pace running 23% up on last season so far. French wheat accounted for 714,000 MT of that.

FranceAgriMer say that the French will export a record 11 MMT of milling wheat outside the EU-27 this season. To facilitate the demand for quality wheat they will need to import more feed wheat than they have since the war.

That shouldn't bee too difficult, with plenty of low grade wheat in neighbouring Germany this year.

In America, the USDA confirmed weekly wheat export sales at a three year record of 1,613,400 MT.

They also dropped 2010/11 US ending stocks a bit more than expected to 902 million bushels, decreased world wheat production by 2.72 MMT and cut EU-27 wheat output from 137.51 MMT last month to 135.13 MMT.

Taking the wind out of the bulls sails however, they cut world usage too, which actually had the effect of raising global ending stocks by just over 3 MMT. Although US ending stocks were cut, the 902 million bushel figure still represents the second highest in more than a decade.