EU Wheat Mixed, Opinions Divided Over 2013 Production Prospects
15/03/13 -- EU wheat futures closed mixed. As an assortment of early crop production forecasts for 2013 seep through, it's apparent that opinions vary quite widely on output potential in 2013, and none more so than at home.
On the day London wheat closed with front month Mar 13 unchanged at down GBP0.60/tonne to GBP194.65/tonne and with new crop Nov 13 down GBP0.35/tonne to GBP183.15/tonne. May 13 Paris wheat was up EUR0.25/tonne at EUR234.75/tonne. For the week Mar 13 London wheat fell GBP1.60/tonne, with Nov 13 up GBP0.40/tonne and May 13 Paris wheat adding EUR4.50/tonne.
Late Thursday Brussels said that it had issued a further 476 TMT of soft wheat export licenses this past week, bringing the 2012/13 marketing year to date total to 14.16 MMT. Add on a further 817 TMT of durum wheat export licenses and we've got an all wheat export total so far of 15 MMT.
With 15 weeks of the 2012/13 season remaining exports only now need to average 300 TMT/week from here on in to hit the USDA's projection of 19.5 MMT for the year. If exports were to continue at 476 TMT/week for the remainder of the season then full 2012/13 shipments would top 22 MMT.
All wheat imports meanwhile currently stand at 4 MMT, with corn imports at 8.2 MMT.
Latest customs data from the UK meanwhile shows that we imported 270 TMT of wheat in January, nearly four times the volume imported 12 months previously. We also imported more that 173 TMT of corn in the first month of 2013, almost double the volume shipped in Jan 2012.
Total UK wheat imports for 2012/13 so far are 1.61 MMT, three times the level of exports.
The NFU report that the UK wheat area "appears around 12% down" - noting that some further wheat area has been planted since their data was collected in December, but also that some crops have since been written off. Some news wires are reporting that they are forecasting a UK wheat crop of 13.5 MMT this year, which sounds unusually bullish of them. What their website actually says is that "13.5 million tonnes is looking optimistic and would rely on very good growing conditions from now."
Even so, anything like 13.5 MMT is well ahead of other analyst's projections. Strategie Grains cut their 2013 UK wheat production forecast to 12 MMT this week, and today Coceral concurred with that view.
Coceral also pegged EU-28 soft wheat production at 127.8 MMT, up 2.6% on output of 124.6 MMT a year ago, but well below Strategie Grains estimate of 131.6 MMT.
Coceral appear less bullish than some about soft wheat production prospects in France, estimating output there at 35.9 MMT, barely changed on 35.77 MMT last year thanks to lower projected yields.
They also estimated this year's EU-28 barley crop at 54.8 MMT, versus 54.5 MMT a year ago and 55.5 MMT from Strategie Grains. For corn production this year they go for 64.4 MMT, versus 56.3 MMT a year ago and 66.0 MMT from Strategie Grains. For rapeseed output they estimate 20.05 MMT versus 19.5 MMT a year ago. Separately, Copa-Cogeca tentatively forecast the EU rapeseed crop climbing to 21.0 MMT this year, with the caveat that "the figures have to be treated with caution, due to the variable weather conditions."
The Russia Ag Ministry estimated the 2013 grain crop at 95.0 MMT, unchanged from their previous estimate and up more than a third on production last year. In the south of the country the leading winter wheat districts of Krasnodar and Stavropol are reported to have had good rains in the past 7-14 days.
SovEcon estimated Russia’s 2013 grain crop at 84-89 MMT, up from their previous estimate of 80-87 MMT, although not as bullish as the Ministry. They estimated winterkill crop losses slightly below average at 9%.
