EU Wheat Ends Mixed, Russian Output Marked Down Again

Posted by Nogger - a legend in his own mind at 19:05 | Categorized as

23/08/12 -- EU grains were mixed with Nov 12 London wheat down GBP0.45/tonne to GBP206.40/tonne and Nov 12 Paris wheat EUR2.75/tonne lower to EUR264.00/tonne.

Russia’s Ag Ministry estimated their 2012 grain crop at 75 MMT versus a previous estimate of 75–80 MMT and 20% down on last year's 94.2 MMT in 2011.

That however is at the top end of private trade estimates. SovEcon predict a grain crop of 70 MMT, of which wheat will account for only 39 MMT, a more than 30% decrease on last year and less than the amount that sparked the 2010 export ban.

A Bloomberg survey predicts that Russia will run out of it's 2012/13 exportable surplus of 10-14 MMT by the end of November.

At home the HGCA said that the winter wheat harvest is 25% done with yields "currently ranging from 5.0-10.7 MT/ha, with no reports of exceptionally high yields." The quality of wheat samples harvested to date is poor, they added.

They peg the average UK yield at 7.1-7.5 MT/ha, which would suggest a final crop of around 14.2-15.0 MMT. Most in the trade are calling things closer to 14.0-14.5 MMT at best, some are suggesting output lower than 14.0 MMT.

For other crops the HGCA said that winter barley harvesting is 95% complete, with yields averaging 6.3-6.6 MT/ha, versus the 5-year average of 6.3 MT/ha. Spring barley is only 15% done, with very variable yields so far of 4.5–7.5 MT/ha.

The winter OSR harvest is 90% complete, with yields said to be holding up surprisingly well against the 5-year average of 3.4 MT/ha at 3.4-3.6 MT/ha.

Elsewhere the IGC came out with a revised world wheat production estimate of 662 MMT versus a previous estimate of 665 MMT. Consumption was seen unchanged at 679 MMT, trimming 2012/13 ending stocks 3 MMT to 180 MMT, the lowest since 2008/09.

World corn production was slashed for the second month in a row, this time by 26 MMT to 838 MMT. Consumption however was reduced by almost as much, 25 MMT, to 853 MMT. That marks the first year on year decline in world usage since 1993/94. With world trade seen declining, that actually raises ending stocks for 2012/13 by 5 MMT to 12 MMT.