EU Grains Close Mostly Lower

17/10/12 -- EU grains closed mostly lower on the day although London wheat managed to post some generally modest gains with Nov 12 up GBP0.15/tonne to GBP198.40/tonne whilst Nov 12 Paris wheat was EUR1.00/tonne lower at EUR256.50/tonne.

Fresh news was pretty limited. Algeria bought 400 TMT of milling wheat, thought to maybe of South American origin, for December delivery. Proof that maybe EU wheat isn't yet quite as competitive as it thought it was.

Open interest in Nov 12 London wheat continues to decline, to less than 1,400 lots today versus more than 10,000 a few months ago, making the market even thinner. May 13 London wheat is more or less running at parity with it's Paris counterpart.

The Ukraine grain harvest currently stands at 38.5 MMT off 89% of the expected area. The corn harvest is at 12.25 MMT off 65% to date, suggesting final output circa 19 MMT. That is some way below the USDA's current estimate of 21 MMT.

Winter wheat plantings in Ukraine are seen 94% complete, with crop conditions much better than a year ago.

The Australian Oilseeds Federation peg the rapeseed crop Down Under at 2.735 MMT, down 14% vs 3.185 MMT in 2011/12.

Egypt’s GASC said that it expects it's wheat imports to total 4.8 MMT in 2012/13, down 9% from 5.3 MMT a year ago.

Excessive rains place Argentina's wheat crop under threat from disease. They also mean that corn plantings are only around 27-28% done versus 32-33% a year ago.

Things are a bit better in Brazil where corn plantings in Parana state are 70% complete and have reached the halfway point in Rio Grande do Sul.