EU Grains Mostly Firmer As Euro Falls On Rate Decrese

Posted by Nogger - a legend in his own mind at 08:27 | Categorized as

07/11/13 -- EU grains closed mixed, but mostly firmer, with Nov 13 London wheat ending up GBP0.75/tonne at GBP164.25/tonne, Nov 13 Paris wheat finishing EUR1.00/tonne higher at EUR203.00/tonne, Nov 13 Paris corn EUR2.75/tonne firmer at EUR174.25/tonne, whilst Feb 14 Paris rapeseed rose EUR3.25/tonne to close at EUR377.25/tonne.

The ECB surprised the market by lowering interest rates in the Eurozone to an all-time low, which boosted prices in Paris as the pound rose to 1.20 versus the euro.

Russia's grain harvest is almost 93% done at 91.6 MMT, including 53.7 MMT of wheat off 97% of the planned area. They've also now harvested 15.8 MMT of barley (off 92% of the expected area) and 7.2 MMT of corn (off 55% of plan). Winter plantings for the 2014 harvest have now been complete on 14.2 million hectares, 87% of original expectations, and 1.4 million less than at this time a year ago.

The leading Russian winter grains producing state of Krasnodar has 1.45 million hectares of it's crop in the ground (96% of plan), of which 1.3 million ha is wheat.

Ukraine has winter wheat planted on 6.2 million hectares versus 6.6 million a year ago.

APK Inform said that Ukraine only exported 669.4 TMT of grains in the week through to Nov 3, a 22% decline on 861.7 TMT a week previously. Wheat shipments fell from 313.2 TMT to 125.7 TMT, and barley exports from 73.9 TMT to 27.3 TMT.

Egypt's GASC only bought one cargo of Romanian wheat in their tender yesterday. This would suggest that the cheaper, quality wheat offers out of Russian and Ukraine may be drying up. The former now appears to have mainly lower grade wheat left on it's hands, whilst the latter may now start to concentrate on exporting it's anticipated 29 MMT record corn crop.

Reports suggest that the first large consignment of Black Sea corn of the 2013/14 season has arrived on Teesside to feed the Ensus bioethanol refinery.

All eyes are now on the USDA's first World Agricultural Supply and Demand report for two months due tomorrow afternoon.

The trade is expecting US all wheat 2013/14 carryout declining to around 519 million bushels from 561 million in September. What the USDA will have to say with regards to Argentine and Australian wheat production this year will also be of interest as other estimates in the market for the former are now universally lower than the USDA's 12 MMT forecast in September. The USDA's FAS yesterday meanwhile cut their forecast for Australia's wheat crop to 23.5 MMT versus the official USDA estimate of 25.5 MMT in September. Canada's wheat output will likely be raised, and what will they have to say with regards to India's export potential?

There are quite a few questions there, and consider that this report is likely to be more about corn and soybeans than it is for wheat.