EU Grains Close
28/06/12 -- EU grains closed generally flat with Jul 12 and Nov 12 London wheat both unchanged, along with Aug 12 and Nov 12 Paris wheat.Prices still hover around 12-month highs on surging US markets concerned about yield losses in corn and soybeans due to heat and dryness. Traders are also a little nervous however ahead of tomorrow's important USDA planting and stocks data.
Latest weather forecasts for the Midwest this afternoon appear to be factoring in more rainfall in the coming 5-day period. However most recent forecasts have failed to deliver promised precipitation.
Today and tomorrow's EU leaders summit is also a cause for nervousness, with few expecting too much in the way of serious and tangible progress to be made.
It seems to be shaping up that the Black Sea countries won't have the same volume of wheat to export in 2012/13, which may stop prices falling out of bed once the harvest gets going in earnest.
Harvesting is already underway around 10 days earlier than normal in the south of Russia, where yields are so far disappointing. Local analysts IKAR today cut their grain harvest estimate from 88.4 MMT to 84.5 MMT, with the wheat harvest coming in at 48.5 MMT compared to 56.2 MMT last year. Grain exports will total 17.5 MMT, compared to an estimated 27 MMT in 2011/12, they added.
Brussels only issued 21,000 MT of soft wheat export licences this past week, a very poor total with just one week of the 2011/12 marketing year left to go.
On the rapeseed front the NFU said as far as the UK crop goes "Continuous rain since March, significantly above average. Crop looks good, although estimates are conservative until it is in the barn. Prospects are likely to improve on current estimates."
In France they say "the end of winter was harsh, with frost damage to eastern crops and particularly oilseed rape in the North East. Spring rain improved the dry conditions of winter crops. Areas are stable at 1.5m Ha, but production will fall to 5 MMT (400 TMT down), with yields at 3.15 MT/ha."
