EU Wheat Close

10/12/10 -- EU wheat closed higher Friday with Jan London wheat up GBP2.00 to GBP190.00/tonne, and new crop Nov GBP1.00 higher at GBP158.50/tonne. Jan Paris wheat rose EUR1.75 to EUR242.00/tonne and Nov climbed EUR2.50 to EUR216.00/tonne.

On the week as a whole Jan London wheat rose GBP2.55/tonne, with Jan Paris wheat up by EUR6.75/tonne.

In London July wheat - despite not trading all day - was cited at closing GBP4.00 higher at GBP199.00/tonne, just a pound short of the magical GBP200.00/tonne mark. Meanwhile this was the highest close for a front month contract since 14th March 2008, and within GBP2.50 of the all time high close for a front month.

The gains were all the more impressive considering that the USDA once again appeared to feel duty bound to throw us a curve ball or two. They surprisingly raised world wheat ending stocks by more than 4 MMT to 176.7 MMT, including an extra 1 MMT here in Europe. World corn ending stocks were also increased by a more modest 800,000 MT.

Maybe European exports are slowing, Brussels only issued licences for 127,000 MT of wheat this week, although that still brings the cumulative marketing year to date total to 10.3 MMT, 37% up compared to a year ago.

The USDA also raised Australian and Canadian wheat production, but dropped exports for both - reflecting sharp decreases in quality. Pakistan got it's output raised by 1.3 MMT.