EU Wheat Mixed, Paris Higher As Euro Slumps

01/03/12 -- EU grains finished mixed with Mar 12 London wheat closing down GBP0.75/tonne to GBP164.075/tonne and Mar 12 Paris wheat rising EUR1.50/tonne to EUR214.50/tonne.

Paris wheat rose as London wheat fell due to a sharp decline in the euro after news broke that Eurozone unemployment rose to a record 10.7% in January. Spain is the worst off where unemployment is now a whopping 23.3%. The pound rose close to the 1.20 level on the news.

As the market closed we had reports that Brussels had issued almost 430 TMT of soft wheat export licences this past week, the best weekly total for seventeen weeks. Even so, cumulative 2011/12 year-to-date exports at just over 9 MMT still lag last season's levels by more than a third.

In complete contrast the USDA reported weekly wheat shipments of only 205,800 MT, the worst since the first week of the marketing year save for the holiday shortened New Year week.

The HGCA reported that winter crop conditions at home are pretty good.

"Overall the wheat crop is well established with good growth over winter. The majority of crops are well tillered with good plant populations," they said.

"Winter barley crops are well established and have a good level of tillering. Weed control is generally good and crops very competitive," they added.

For oilseed rape "crops tend to be well established with large canopies this season. Some older leaves died back in the cold spell in early February, but many crops remain large," they noted.