EU Wheat Close

Posted by Nogger - a legend in his own mind at 18:59 | Categorized as

13/12/10 -- Jan London wheat closed GBP0.25 higher at GBP190.25/tonne and new crop Nov was up GBP0.50 at GBP159.00/tonne. Paris wheat closed mostly a tad lower with Jan down EUR0.50 at EUR241.50/tonne and Nov unchanged at EUR216.00/tonne.

It was another highest close since March 2008 for London wheat, albeit a modest one. French wheat traded both sides but ultimately closed mostly a fraction lower as the euro strengthened a little.

The market is trying to weigh up the undoubted tightness in EU stocks against falling demand from the feed sector at these prices.

Friday's report from the USDA raised EU carry-in from 2009/10 and dropped consumption from the feed sector this season, upping 2010/11 ending stocks by a million tonnes despite the phenomenal current pace of exports.

World stocks of quality wheat continue to erode, with the latest estimates on the eastern Australian crop now pegging feed grade there at "at least" 50% of the crop.

Quality is also in short supply in the barley market, with Russia now expected to import the best part of half a million tonnes of malting barley before next harvest on the back of their drought earlier in the year.

Meanwhile rapeseed prices continue their almost inexorable rise to all time highs, with the Feb Paris future up EUR6.75 at the close to EUR480.50/tonne. Old crop UK ex-farm values are now fast approaching GBP400/tonne.