EU Grains Mostly Lower On Continued Harvest Pressure
17/09/13 -- EU grains closed mixed but mostly lower with Nov 13 London wheat settling GBP0.95/tonne lower at EUR151.25/tonne and Jan 14 also GBP0.95/tonne easier at GBP154.20/tonne. Nov 13 Paris milling wheat fell EUR0.25/tonne to EUR184.75/tonne whilst Nov 13 Paris rapeseed settled EUR4.00/tonne lower at EUR369.00/tonne.
European wheat is stuck in a low range, with harvest pressure, a large barley crop and a looming sharply higher corn crop capping the upside. The very robust pace of EU exports so far this campaign is supportive though, keeping Europe on track to ship a record wheat volume in 2013/14.
The Russian grain harvest is progressing slowly, held up by rain, and now stands at 71.1 MMT off 69.1% of the planned area. Out of that total they've harvested 44.4 MMT of wheat, 13.9 MMT of barley, over 1 MMT of corn and 1.5 MMT of sunseed.
The latter is an interesting number as it comes off less than 10% of the planned area. A quick "back of a fag packet" calculation indicates that final sunseed production this year could be far higher than the USDA's current estimate of 8.9 MMT unless yields fall off a cliff.
Russian wheat yields meanwhile are currently said to be averaging 2.52 MT/ha, up 35.5% versus 12 months ago. There's repeated trade chatter that the same wet weather that's holding up the harvest is also delaying winter plantings.
That's also the case in Ukraine, where the planned winter cereal area is only 9% planted at 766k ha, although OSR plantings are now 73% complete at 673k ha.
The newly begun, and expected record, 2013 Ukraine corn harvest stands at 1.17 MMT, with yields up 41.7% at 4.89 MT/ha. That brings the total grain harvest so far this year to in excess of 34 MMT versus a little more than 28 MMT a year ago.
The Ukraine Ministry report August wheat exports at a record for that particular month of 1.372 MMT. Egypt was the top destination. That takes July/Aug wheat exports to 1.624 MMT, up 34% on year ago levels.
Harvesting of grains in Kazakhstan is also behind schedule due to rain, having now limped just past halfway, producing 8.2 MMT to date.
There's also repeated talk of quality issues for both Russian and Kazakh wheat due to late rains.
Switching Down Under, there are suggestions that the Western Australia state canola crop is being sprayed off ready to begin harvesting at the end of the month. Crop conditions are said to look very promising.
Also in the Southern Hemisphere, wheat harvesting in Brazil should be underway around a month from now in the major producing state of Parana. We'll be able to get a better handle then on crop losses due to frost in the past month or two.
South America's largest wheat buyer is said to have imported 4.653 MMT of wheat in the Jan/Aug period, little different to the 4.461 MMT imported in the same period in 2012. What's a big difference though is where it's come from. Last year only 36 TMT of that came from the US, this year US wheat imports have been 1.463 MMT due to lack of availability from Brazil's traditional number one supplier, Argentina.
The latter will begin their 2013/14 wheat harvest mid-November and should have it mostly wrapped up by the turn of the year.
