EU Wheat Mixed, Rapeseed Reaches New Highs

Posted by Nogger - a legend in his own mind at 19:34 | Categorized as

23/04/12 -- EU grains finished mixed with May 12 London wheat closing GBP2.30/tonne lower at GBP174.00/tonne, but with new crop months fractionally higher. May 12 Paris wheat fell EUR1.50/tonne to EUR215.00/tonne, new crop months also lower. May 12 Paris rapeseed ended EUR3.75/tonne higher at EUR505.00/tonne, the highest level for a front month since January 2011.

The notion that old crop London wheat had developed ideas above its station appears to possibly have been confirmed in the last couple of sessions. Even so, GBP174.00/tonne is still the equivalent of around EUR213.50/tonne, a historically very modest discount to Paris wheat.

The European Commission's crop-monitoring unit MARS reduced it's EU-27 rapeseed and barley yield expectations for 2012 compared with last month, although they still say that in general prospects are average this year.

Some winterkill damage has been done on the continent it would seem, although in the UK, they say that “crop growth and development is more precocious due to warmer than usual conditions. Drought may not cause much problem to winter crops if current April rains continue."

It certainly looks like they will.

Overall they peg EU-27 wheat yields 1.1% higher than last year at 5.36 MT/ha, with the UK enjoying a 4.1% rise to 8.07 MT/ha. EU barley yields are forecast up by 1.1% to 4.39 MT/ha, with those here seen rising a bit better than that, up 2.7% to 5.82 MT/ha.

Rapeseed looks set to be the drop that has suffered most here at the hands of Mother Nature, with UK yields seen falling 12.6% to 3.44 MT/ha, although that is from record levels in 2011. It should also be noted that UK plantings are forecast up sharply too, so all in all we may end up with output not too far short of last year's record 2.8 MMT.

The reduction in UK yields is a result of "recent rains are coinciding with the flowering stage, and they might hamper pollination", they say.

Tomorrow Stats Canada will report on rapeseed plantings there with a record area expected. Precipitation has increased significantly in eastern Saskatchewan and Manitoba in recent weeks, easing drought concerns, according to Martell Crop Projections.