EU Wheat Mixed But Mostly Higher

03/03/11 -- EU wheat closed lower mixed with Mar London wheat up GBP1.75 to GBP199.35/tonne and new crop Nov GBP2.30 higher at GBP163.30/tonne. Mar Paris wheat fell EUR2.50 to EUR254.50/tonne, with Nov rising EUR0.75 to EUR219.00/tonne.

Exactly how old crop feed wheat prices are rising whilst milling wheat levels are falling is beyond me. Just about every feed compounder in the UK is reporting slack demand for finished feed, and rising prices are hardly going to improve the situation any.

March Paris wheat expires next Thursday, which may account for some of the nearby weakness, although it hardly explains why May and August should also close lower.

"The futures market can do what it likes, it's not going to make any difference to (sluggish) physical demand one jot," said one trader today.

To perhaps emphasis that point, Brussels announced today that they'd issued soft wheat export licences for 244,000 MT this past week. That means that we've only hit our weekly requirement needed to hit the USDA's predicted 21.5 MMT total for the current marketing year in two of the past nine weeks.

US wheat was higher in afternoon trade on drought in the southern Plains and flooding in the north, lending some late support to EU markets.