EU Wheat Mixed On The Day But Posts Solid Weekly Gains

27/01/12 -- EU grains ended narrowly mixed Friday, with Mar 12 London wheat up GBP0.05/tonne to GBP164.55/tonne and Mar 12 Paris wheat down EUR0.25/tonne to EUR209.00/tonne.

Despite a subdued day today, overall London wheat has gained an impressive GBP7.55/tonne and Paris wheat EUR10.50/tonne during the course of the week.

Defra have made a few minor tweaks to the supply and demand numbers this week, reducing wheat imports and 2011 production slightly and increasing domestic consumption a fraction.

They've also introduced a new format to the way the balance sheet numbers are presented, introducing an "estimated operating stock requirement" which this season is pegged at 1.4 MMT. They now subtract that figure from the total available stocks less consumption before coming up with an exportable surplus. All clear?

That exportable surplus is said to be 2.54 MMT, around 180,000 MT less than in 2010/11. However they also tell us that we've already exported half of that amount by the end of November, which at a glance makes things look pretty tight with seven months of the season remaining.

Bear in mind though that this is now with 1.4 MMT skimmed off and "kept back for a rainy day" so to speak.

It is also notable that they have human and industrial consumption at only 300,000 MT less this season than it was in 2010/11. Without naming names they say that they are working on the assumption that "the one existing bioethanol plant" will be back in production Apr/Jun.

They also say that "usage by the bioethanol plant currently under construction is not included; its status will be reviewed in March."