EU Wheat Falls As Exports Slacken

15/02/11 -- EU wheat closed lower across the board with Mar London wheat down GBP3.00 to GBP207.00/tonne and new crop Nov GBP5.00 down at GBP177.00/tonne. Mar Paris wheat fell EUR8.25 to EUR266.50/tonne, with Nov down EUR7.75 to EUR238.75/tonne.

There were some pretty steep declines today. A stronger pound after UK inflation rose again last month, prompting ideas of rising UK interest rates before too long, weighed on London wheat.

Not to be outdone, Paris grains declined even more steeply on ideas that exports are dwindling as EU wheat prices itself out of the export market.

Australia have plenty of feed wheat this year, and some of it could be coming our way if Brussels rescind the existing duty on imports.

Figures out today show that the UK exported 266,000 MT of wheat in December bringing the marketing year-to-date total to more than 1.9 MMT. Even so that's 44% down on what we exported in November, and seems to indicate that exports are slowing rapidly.

Indeed, most UK merchants are reporting a marked lack of interest with foreign buyers keener on selling-back existing purchases than seeking more wheat.

Suddenly things look very toppy. Front month Paris rapeseed has fallen an astounding EUR57.75/tonne in less than a month, with EUR9.00/tonne of those losses coming today.