EU Wheat Close - Monday

30/01/12 -- EU grains finished mixed with front month Mar 12 London wheat up GBP0.45/tonne to GBP165.00/tonne but other old crop months GBP0.50/tonne lower. Mar 12 Paris wheat was unchanged at EUR209.00/tonne.

The markets drifted sideways. Negative influences were another bout of Eurozone jitters with the newswires awash with stories of Portugal getting dragged further into the mire.

Their borrowing costs rose to new euro-era highs today, as they are starting to look more and more like Greece #2. The latter hasn't yet managed to pull off a deal with private bond holders despite insisting that one is "very close" - weekend reports that their Eurozone exit strategy plan is at an advanced stage are also unsettling.

Underpinning the market however is concern developing over the ability of wheat in eastern Europe, Russia and Ukraine to withstand very cold temperatures this week, with Moscow's daytime high on Wednesday forecast to be a frigid -19C.

"A prolonged period of unseasonably warm weather has come to an abrupt end in Russia. Bitter cold is affecting the entire winter wheat zone not only the Volga and Central district, but also southern Russia wheat near the Black Sea," say Martell Crop Projections.

"The cold wave is expected to continue for another week with temperatures 15-20 F below normal," they add.

In contrast, things are looking up in Argentine with widespread rains in the forecast this week, although most seem to think that for corn the damage is done there is still time to see soybean prospects improve.