EU Wheat A Little Lower Pressured By Sharp Rebound In Black Sea Production

Posted by Nogger - a legend in his own mind at 07:16 | Categorized as

02/08/13 -- EU grains closed mostly a little easier on continued harvest pressure, even though reports of low protein levels in French wheat persist. The "usual suspects" are lining up with a strong rebound in production this year to aggressively market their wares.

Nov 13 London wheat ended the day GBP0.15/tonne lower at GBP162.70/tonne and with Jan 14 also closing down GBP0.15/tonne at GBP163.70/tonne. Nov 13 Paris wheat fell EUR0.75/tonne to close at EUR186.50/tonne.

That means there's been very little change in wheat prices for the week as a whole, with Nov 13 London wheat ending the week just five pence lower than it began it, Nov 13 Paris wheat lost EUR1.25/tonne versus last Friday.

FranceAgriMer said today that the French wheat harvest had advanced from 14% done a week ago to 30% complete as of Jul 29. The winter barley harvest is almost over at 98% complete, whilst even 12% of the French spring barley is already in the barn.

The French corn crop has advanced to 47% silking from only 12% a week previously, although well behind 80% this time last year. Corn good/excellent crop conditions fell 2 points on last week to 55%. Good/excellent ratings in wheat held steady at 66%. Spring barley good/excellent fell one point to 67%.

The Ukraine early grain harvest is winding down at 91% complete, producing 28.8 MMT of grains so far. That total includes 20.79 MMT of winter wheat off 94% of the anticipated area. They've also harvested 151,600 MT of spring wheat off 42% of the planned area.

The winter barley harvest is over, producing just under 3 MMT. Spring barley is 85% cut, with a crop of 3.82 MMT so far. The Ukraine OSR harvest is 99% complete, producing a crop of 2.18 MMT.

The Ukraine Ag Minister said that this year's early grain crop (which excludes corn production) will total 31 MMT. The full grain harvest including corn will be a record 57-58 MMT, allowing exports also of record levels at around 27-28 MMT, propelling Ukraine into the world's top three grain exporting nations, he added.

To add further pressure to European grain prices, Kazakhstan today raised their forecast for this year's grain crop from 15 MMT to 16.3 MMT, saying that 67% of the crop was in good condition, and a further 30% rated as being in fair condition. A crop of 16.3 MMT would represent a more than 26% increase on output in 2012.

The Russian harvest has slowed up due to rain in the Central and Volga Districts during recent days. So far nearly 37 MMT of grains have been harvested off 28.4% of the planned area. Wheat accounts for 29.4 MMT of that off 38.1% of the anticipated area, with yields up 26% at 2.82 MT/ha to date.

Brussels confirmed yesterday that they'd issued 566 TMT of soft wheat export licenses in the past week, bringing the 2013/14 year-to-date total to 1.6 MMT. They also approved 270 TMT of barley for export, taking the YTD total to 1.2 MMT, along with 130 TMT of corn (YTD total now 277 TMT).

French milling wheat delivered Rouen is offered at EUR184/tonne (circa GBP160/tonne), with French barley around EUR10/tonne under that. French OSR FOB Moselle is offered at EUR355/tonne (around GBP309/tonne).

Thailand bought two cargoes of Black Sea feed wheat for Oct/Nov shipment at USD258-259/tonne C&F. That's the equivalent of GBP170/tonne including shipping costs.

ODA estimated the UK wheat crop at around 11.7 MMT versus 13.3 MMT last year. Their figure is very close to the USDA's current forecast of 11.75 MMT.