EU Grains Correct Lower

24/10/13 -- EU grains closed lower, partially correcting from the recent rise. Talk of frost damage in Australia and ideas that Argentina may soon limit exports is supportive. So too are late/unfinished winter grains plantings in the FSU. An impending record world corn crop is not however.

Nov 13 London wheat closed down GBP0.35/tonne at GBP165.65/tonne, Nov 13 Paris wheat ended EUR2.75/tonne lower at EUR204.75/tonne and Nov 13 Paris rapeseed was EUR4.75/tonne weaker at EUR375.50/tonne.

Russia's 2013 harvest is finally drawing to a weather-delayed close at 89 MMT off 91.1% of the anticipated area. A year ago at this time they'd only harvested a crop of 72 MMT. The 2013 wheat harvest stands at 53.3 MMT off 95.2% of plan, with the barley harvest at 15.8 MMT off 91.2% and the corn harvest at 5.4 MMT off 42.2% of the planned area. All these tonnages are in bunker weight.

ProZerno forecast a clean weight Russian grain harvest of around 90 MMT, including "about" 51 MMT of wheat, 15.1 MMT of barley and in excess of 10 MMT of corn. Last year's clean weight harvest was 37.7 MMT of wheat, 14 MMT of barley and 8.2 MMT of corn, according to the USDA. ProZerno forecast Russian 2013/14 wheat exports at 16 MMT, maybe more, with barley exports at 2.7 MMT and those for corn at 2.6 MMT.

The Russian Ministry now say that winter grain plantings for the 2014 harvest are complete on 13.4 million hectares, or 82% of the originally predicted area. That's up 1.8 million hectares in a week and 4.2 million higher than a fortnight ago. The Ministry now only expect plantings to reach 14 million hectares before winter sets in.

The Ukraine Ministry meanwhile are standing by a forecast for a 2013 grain harvest of a record 60 MMT, with exports being "at least" 28 MMT and possibly as much as 30 MMT. APK Inform say that although the country has the potential to export 30 MMT of grains in 2013/14, only 23.5 MMT is more likely given infrastructure constraints. That potentially means that 2013/14 ending stocks would be record high and include 5.5 MMT of wheat, 1.2 MMT of barley and 6.2 MMT of corn.

APK Inform see final 2013 winter grain plantings in Ukraine at around 6.0 million hectares for wheat and 1 million ha for barley. The original Ministry targets were 6.7 million and 1.2 million respectively.

The German Stats Office report that the country exported 2.5 MMT of grains in Jul/Aug, versus 1.5 MMT a year previously. Wheat exports rose from 733 TMT to 1.3 MMT.

MDA CropCast dropped their Argentine wheat production forecast by 0.9 MMT to 10.0 MMT, the second cut in a fortnight.

The Philippines reportedly bought Ukraine wheat at a cheap looking $260 C&F for November shipment in a tender. Iraq bought 100,000 MT of Australian wheat and 50,000 MT of Canadian wheat for Nov/Jan shipment.

India cancelled a tender to export wheat after deeming the bids received as being too low. They still appear to want a minimum of $300/tonne FOB.

Brussels issued 384 TMT of soft wheat export licences this past week, that's up on the 269 TMT granted last week, but just ok compared to the early season pace. We may need a few more weeks at this sort of level yet to see if this is the start of a new trend.