EU Grains Closing Comments

15/05/12 -- EU grains finished mostly higher with May 12 London wheat ending unchanged at GBP173.50/tonne, new crop Nov 12 was up GBP1.60/tonne to GBP149.30/tone. Nov 12 Paris wheat was up EUR4.00/tonne to EUR199.50/tonne.

After a couple of risk off day the market was perhaps due some kind of correction. Greek concerns haven't gone away though, with the pound rising to a new 3 1/2 year high of 1.2560 against the euro today. That perhaps explains why Paris wheat posted better gains than London wheat today.

The market is thin and looking for direction, it's been two months since London wheat has closed outside the GBP170's on a front month.

Dry and warm weather in parts of China, Russia, Ukraine and Kazakhstan is causing some concern, although it's too early to quantify any losses that may have occurred.

There are doubts over the health of US winter wheat too, after the USDA last night cut their national crop ratings by 3 percentage points in the good/excellent category to 60%. Top producing state Kansas saw the percentage of its crop rated in the top two categories slump by eight points to 52%. Ideally the crop there would like one more decent rain to see it through to harvest in a couple of weeks time.

Spring wheat planting in the US is progressing at a record pace, with 94% of the crop now in the ground.

Tunisia is forecast to have its largest grain harvest in decades this year, according to its Agriculture Minister. Harvesting there begins next month.