EU Grains Mostly Lower On The Day, Higher On The Week

11/10/13 -- EU grains closed mixed but mostly lower on the day, but higher for the week. Nov 13 London wheat settled GBP0.25/tonne firmer at EUR163.00/tonne, whilst Jan 14 was down GBP0.25/tonne at GBP163.75/tonne. Nov 13 Paris milling wheat was up EUR0.50/tonne at EUR199.25/tonne whilst Nov 13 Paris rapeseed fell EUR5.00/tonne to EUR372.75/tonne.

For the week, Nov 13 London wheat was up GBP4.25/tonne, with Nov 13 Paris wheat EUR4.75/tonne higher and Nov 13 Paris rapeseed EUR4.75/tonne firmer.

Strong underlying demand for EU wheat was highlighted again, even if Egypt didn't like the look of the prices in their cancelled tender, with Brussels granting 839 TMT of soft wheat export licenses this past week. That was the best weekly total of the season so far and takes the total volume of export licences granted so far this season to 7.75 MMT. That's a very respectable total little more than a quarter of the way into the season.

It was interesting to note that Romanian wheat was the cheapest in the Egyptian tender at USD274.64/tonne, closely followed by French wheat at USD276.25/tonne and then Russian wheat at USD278.00/tonne.

The big question now is can Nov 13 French wheat manage to get above EUR200/tonne and stay there? It didn't manage to hold there yesterday, and only traded up to EUR199.50/tonne today.

If wheat demand continues to hold up at these levels then it could certainly push above EUR200/tonne, although Paris corn closing at EUR173/tonne is a negative factor.

The French corn harvest is just getting underway at 2% complete as of Oct 7, say FranceAgriMer. They left good/very good corn crop condition ratings unchanged on a week ago at 57%. This time last year 14% of the French corn harvest was already in.

Plantings for the 2014 harvest are well advanced compared with this time a year ago though. FranceAgriMer said that winter barley is 43% planted versus 16% last week and 19% a year ago. Winter wheat is 23% planted, up from 9% a week ago and 12% this time last year.

Russia's grain harvest is almost 85% complete at 82.9 MMT in bunker weight. Wheat accounts for 50.6 MMT of that off almost 89% of the planned area. Both SoveEcon and IKAR cut their 2013 grain harvest forecasts today, to 87 MMT in clean weight (incl. 50 MMT of wheat) and 86 MMT (incl. "about" 50 MMT of wheat) respectively.

Russia exported 2.88 MMT of grains in September, of which 2.11 MMT was wheat. That takes the 2013/14 marketing year total to date to 9 MMT, a 12.6% increase on last year. The Ministry's target for full season exports is 18-20 MMT.

Australia's wheat harvest is still only in it's early stages, but there's a lot of optimism for a very good crop there, with estimates ranging from 24.5 MMT to 26.0 MMT versus 22 MMT in 2012/13.

Chicago Grains Thursday Afternoon

10/10/13 -- US Weather, from Martell Crop Projections: Indian summer weather is coming to a halt with a cold wet forecast in central United States. The first frost of the season is anticipated in the northern Midwest. The weather is set to deteriorate today in the Northern Great Plains with a wave of strong showers. This would be followed by more wet weather on the weekend. A powerful storm would lift out of the Southwest United States tracking north through western parts of South Dakota and North Dakota into Canada. Widespread rain is indicated in the Great Plains and Upper Midwest. Very heavy rains would target Nebraska, Minnesota, South Dakota and North Dakota, 1-3 inches. East of the Mississippi River, dryness is expected to continue, allowing the harvest to advance. Sharply colder air would sweep into the north-central United States behind the storm. A hard freeze is predicted in Montana and North Dakota Sunday morning and scattered frost in Nebraska and western Iowa. This would be 1-2 weeks later than the average date for the first fall freeze. Late planted corn and soybeans greatly benefited from an extended warm fall, allowing crop development to advance toward maturity. September-October temperatures have averaged 68.9 F and 4 degrees above normal. The wet forecast is favourable for winter wheat planting in the Great Plains. Kansas has received near normal moisture in September and October, but more rain would be desirable, enhancing germination and promoting high plant populations. Oklahoma wheat has received around 90% of average rain this fall the second top wheat state. The new forecast is wet in the central and southern Plains where winter wheat is heavily cultivated.

Soycomplex: Beans trade around 4-7 cents higher, with meal up a dollar or so and oil 35 points firmer in early trade in the daytime open outcry session. Good harvest weather is forecast for the Midwest through to Saturday. Rains are in forecast Sun-Wed. Talk that China is buying more US soybeans is seen as supportive. US farmers seem to be holding onto their new crop beans, hoping for higher prices to come. The US government shutdown grinds on, although there are signs of increased optimism of some sort of deal being done within days, even if offers only a temporary solution to the problem. Paraguay's government have approved a 10% soybean export tax.

Corn: Corn trades around 5-6 cents easier on harvest pressure. There's talk that China have been in the market for US corn this week, but with the USDA closed there's no official confirmation. Corn used in last week’s US ethanol production data is estimated at 91.14 million bushels versus the 94.4 million bushel average needed each week to reach the USDA projection for the year. MDA CropCast left their forecast for the US 2013 corn crop unchanged at 13.357 billion bushels, or 339.3 MMT, up 30.7% on last year. Strategie Grains raised there forecast for EU-28 corn production from 64.0 MMT to 64.9 MMT, up 13% on last year. Russia's corn crop is approaching a quarter done, producing over 3 MMT to date. Colombia and Venezuela are seeking US corn for early 2014 shipment,

Wheat: CBOT wheat trades around 2 cents easier. Egypt cancelled their wheat import tender to the surprise of the trade. Traders noted with interest that there were no offers of Ukraine wheat made. Framers in Western Australia state are said to be excited by the prospect of a bumper harvest this year, which is just about underway. Strategie Grains cut their EU-28 soft wheat production estimate from 135.5 MMT to 135.2 MMT, although that still 8% more than a year ago. Russia's wheat harvest now stands at 50.2 MMT off 88% of the planned area. Russian winter grain plantings are only done on 9.2 million ha versus 14.0 million this time a year ago. Trade estimates are than only 12.5-14.0 million ha of the planned 16.4 million will get sown before winter sets in hard.

EU Wheat Gives Up Some Gains As Egypt Cancel Import Tender

10/10/13 -- EU grains are trading higher heading into the close with Nov 13 London wheat GBP1.00/tonne firmer at EUR162.50/tonne and Jan 14 up GBP1.75/tonne at GBP163.50/tonne. Nov 13 Paris milling wheat is currently EUR0.75/tonne steadier at EUR198.25/tonne whilst Nov 13 Paris rapeseed is EUR5.00/tonne higher at EUR37.75tonne and Paris corn trades EUR0.50/tonne firmer at EUR174.00/tonne.

I'm off to the Hull Dinner this evening so this report is being posted ahead of normal time. Paris wheat traded above EUR200/tonne on the Nov 13, a close there would have been the first time since Jun 21st that a front month had closed above that level. Nov 13 London wheat hit GBP164/tonne - it hasn't closed that high since the last day of July, but both had failed to hold and slipped away heading into the close.

The reason for the capitulation may have been disappointment that Egypt, back in the market tendering for wheat for Nov 21-30 delivery, subsequently cancelled the tender. No explanation why was immediately available, but it could be that they judged the prices to be too high.

As was widely expected the Bank of England left UK interest rates on hold at 0.5% today - they've now kept them at the same level since March 2009. There was no change either to QE, which was kept at GBP375 billion. The pound didn't move much on the news, which was widely expected. The US dollar is firmer on optimism that progress is being made in resolving the US debt ceiling issue, even if only temporarily.

The HGCA reported that the Scottish wheat area for the 2013 harvest was the smallest since 2000 at 86,840 ha, a 14% decline on last year. The OSR area fell 8% year -n-year to 33,653 ha, with the barley area up 2% to 339,138 ha and the oats area increasing by 34% to 31,728 ha.

EU wheat is looking to extending its recovery from the mid-August harvest closing lows of GBP150.75/tonne in London and EUR182.00/tonne in Paris. The corn market in Paris also bottomed around then at EUR164.50/tonne, although for earlier harvested Paris rapeseed the front month low of EUR342.00/tonne came a little sooner - in late July.

Algeria bought 500 TMT of most probably French wheat at around USD290-291/tonne C&F for December shipment yesterday.

FranceAgriMer said that French wheat exports to non-EU destinations were up by 44% to 2.5 MMT in Q1 of the 2013/14 marketing year, with barley exports rising by 58% in the same period. They've increased their forecast for French wheat exports outside the EU now to 11.2 MMT, from 11 MMT previously and up 13% versus 9.9 MMT in 2012/13.

Strategie Grains today revised their forecasts for 2013/14 EU-28 crop production, trimming slightly their soft wheat forecast from 135.5 MMT to 135.2 MMT, although that's still an 8% increase on last year. In contrast, they upped their barley production estimate from 59.1 MMT to 59.3 MMT, also an 8% rise on 2012.

Corn output was also increased from 64.0 MMT to 64.9 MMT, that's a 13% jump on last year. They said that the relatively high price of French corn compared to Black Sea options would mean a rise in EU corn imports this season, which were increased from the 9.3 MMT forecast last month to 9.6 MMT, despite the fairly steep rise in production here.

It's worth noting that some of these numbers are significantly different to those issued by the USDA last month, the latter only had EU-28 corn imports at 7.5 MMT in the September WASDE report for example, highlighting that some large changes could be possible to the global supply and demand picture when the USDA finally resume issuing their reports.

Informa increased their forecast for the global OSR crop from 66.8 MMT last month to a record 68.7 MMT, and a 7.5% increase on last year. That figure is also significantly different to the USDA's 66.5 MMT estimate in September.

In their first peek into 2014/15, Strategie Grains said that they expect a small reduction in the overall cropped area in the EU-28. There will be a 5% drop in corn sowings in favour of a 3% rise in soft wheat plantings, they predicted. There will also be a 7% drop in the EU-28 spring barley area. This would appear to be partly a function of the current price differential between wheat and barley/corn and also the much better winter planting conditions this year.

This situation would appear to be likely to be replicated here in the UK, with talk already of bumper wheat plantings for 2014, and the potential for a strong jump in production to bumper, if not even record levels. There's nine month's to go yet until that particular baby is born though.

EU Rapemeal Prices

10/10/13 -- Rapemeal prices on the continent are mostly a little firmer, mirroring stronger soymeal values in Chicago and Europe, despite the outlook for a record world OSR crop this year. Informa Economics now peg global OSR output at 68.7 MMT, up from 66.8 MMT previously and the USDA's September forecast of 66.5 MMT.

Latest guide prices for EU rapemeal today, basis FOB Lower Rhine in euros/metric tonne, with change from previous trading session:


Chicago Market Little Changed In The Dark

09/10/13 -- General Comment: The dollar rose from it's recent demise on news that President Barack Obama has nominated Federal Reserve Vice Chair Janet Yellen to replace Ben Bernanke at the head of the US Central Bank. Essentially the market sees Yellen as Bernanke in a dress, a woman who is unlikely to change her predecessor's relaxed stance on continued financial stimulus. The market seems to neither know nor care where the money comes from, even amidst the US budget deadlock, as long as the cheap money era looks like continuing. There's a feeling that the US debt ceiling will be raised within days, by hook or by crook, as default isn't viewed as much of an alternative. And so the whole merry jamboree goes round one more time. Will that be enough to encourage a "risk on" mentality to return to the grains sector? There wasn't much change across the grains sector today, as the market remains largely reliant on guesswork with the USDA closed. Some now suggest that the October WASDE report (originally due Friday) may be scrapped altogether. Who is collating the information whilst the respective departments are shut? It may be therefore that we have to wait until November for the next raft of global supply and demand estimates from Washington, although weekly export sales/crop progress data will hopefully resume before then.

Soycomplex: Beans closed slightly lower on light fund selling. With no CFTC report to go on, it is estimated that funds have been net sellers of around 12-15,000 soybean contracts since the last report based on positions as at the close of business on Sep 24. That includes selling an estimated 1,000 lots today. The US weather looks good for harvest advancement, at least through to the weekend, when the harvest might be as much as 40% done. Better than expected yields are continually being reported. Lanworth Inc upped their US yield estimate to 42.0 bu/acre, with production increased from 3.112 to 3.160 billion bushels. They also raised their global soybean crop estimate from 284 MMT to 286 MMT. Lanworth said that soybean yields in Illinois and Nebraska are above expectations. Conab estimated the Brazilian 2013/14 soybean area at a record 28.663-29.356 million ha. They have production at a record 87.6–89.7 MMT versus the USDA estimate of 88.0 MMT, and up significantly from the previous record crop of 81.5 MMT in 2012/13. Domestic Brazilian soybean consumption was estimated at 40.7 MMT, with exports at 45.9 MMT. Southern Brazil has rain in the forecast, but there's precious little in the north. Argentina waits for rain before they start planting beans. Back from holiday, China will auction 500 TMT of soybeans from reserves tomorrow. China are said to have bought a few cargoes of US beans off the PNW for Dec/Jan shipment earlier in the week. Nov 13 Soybeans closed at USD12.87 3/4, down 1 cent; Jan 14 Soybeans closed at USD12.84, down 3 3/4 cents; Oct 13 Soybean Meal closed at USD425.20, down USD3.50; Oct 13 Soybean Oil closed at 40.55, up 35 points.

Corn: Corn closed with modest gains in light fund buying/unwinding of long wheat/short corn spreads. Funds were estimated as net buyers of around 4,000 corn contracts on the day. That still leaves them as an estimated net seller of around 4-5,000 since the last CFTC report however, so they are still potentially sitting on a near record short position. Amidst unconfirmed rumours that China had bought up to 900 TMT of US corn last week, Reuters today carried a report that one Chinese buyer confirmed that they had bought 420 TMT of corn from the US for May/Jul shipment. The US Energy Dept are still open (although it is suggested that their funding will run out by the time that next week's report is due unless a budget deal gets done before then). They said today that US ethanol production dropped 7,000 barrels/day from last week to 868,000 bpd. Production needs to average around 900,000 bpd to meet the USDA's estimate of 4.9 billion bushels of US corn going into the ethanol sector in 2013/14. Lanworth estimated the 2013 US corn crop at a record 13.708 billion bushels versus a previous estimate of 13.483 billion. They said that corn yields in Nebraska and Illinois are near record levels. They also increased their world corn crop estimate from 949 MMT to a record 953 MMT. Conab estimated the Brazilian corn crop in 2013/14 at a surprisingly high 78.0-79.6 MMT versus the USDA estimate of only 72.0 MMT, that's very similar to the 2012/13 record crop of 79.6 MMT. Dec 13 Corn closed at USD4.43 1/2, up 1 3/4 cents; Mar 14 Corn closed at USD4.56 1/4, up 1 3/4 cents.

Wheat: Wheat was modestly lower on light fund selling/profit-taking and unwinding of spreads with much cheaper corn. Fund selling was estimated at around 1-2,000 CBOT wheat on the day. They are said to have covered in around 20-25,000 of their CBOT wheat short position since the last CFTC report. USD7/bu is starting to look like it will be a tough nut to crack for Dec 13 CBOT wheat in the midst of a record US corn harvest. "North Dakota spring wheat production finished near average this year, despite the smallest area for harvest since 1988. Favourable production occurred due to a cool summer that sharply boosted wheat yields. The 46 bushels per acre yield tied with 2009 for the highest on record. A good crop in North Dakota wheat is significant, since this is the United States second largest wheat producing state behind Kansas," said Martell Crop Projections. Meanwhile "Winter wheat conditions on the Great Plains are much improved over a year ago when serious drought was present," they add. Algeria bought 500 TMT of optional origin, probably French, milling wheat for Dec shipment in a tender. Jordan, Iraq and Bangladesh are also in the market. Russia's wheat harvest is approaching the final leg at nearly 88% done. They've already harvested a crop of 50.2 MMT so far (in bunker weight), although an unusually high proportion of that is likely to be only feed grade. Egypt issued a late tender for wheat for Nov 21-30 shipment, which should provide a useful barometer for the market tomorrow. Dec 13 CBOT Wheat closed at USD6.90 1/2, down 3 cents; Dec 13 KCBT Wheat closed at USD7.59, down 1 1/2 cents; Dec 13 MGEX Wheat closed at USD7.53, down 1/4 cent.

EU Grains Mostly Firmer As FSU Planting Delays Dominate

09/10/13 -- EU grains closed mixed, but mostly firmer, with Nov 13 London wheat settling GBP0.40/tonne higher at GBP161.50/tonne, whilst Jan 14 was GBP0.15/tonne firmer at GBP161.75/tonne. Nov 13 Paris milling wheat settled EUR1.25/tonne steadier to close at EUR197.50/tonne. Nov 13 Paris rapeseed was up EUR5.50/tonne at EUR373.75/tonne.

An enormous amount is being made of delayed FSU winter wheat plantings in the popular media, maybe more than is now warranted. Current prices offer a huge incentive to plant winter wheat compared to hanging on until the spring to opt for corn. The weather in Russia and Ukraine finally seems to be co-operating too.

Russian winter grains plantings are said to be completed on 9.1 million hectares, 55.5% of the original plan, although that is up 400k ha in a day. It would take 18 days of progress at that rate to reach the Russian Ministry's initial forecast of plantings at 16.4 million ha, although most are now forecasting a winter grains area of only 12.5-14.0 million ha.

Ukraine has planted winter grains on 4.4 million ha meanwhile. That includes 3.9 million ha of wheat out of an originally expected area of 6.7 million (58% of plan). To hit the Ministry's initial forecast Ukraine farmers would need to plant 140k ha of wheat each day for the next 20 days. That is a tall, but still achievable order, according to Ukraine agronomist Mike Lee.

As far as harvesting goes, Russia's grain crop is now 83.8% in the bin at 81.8 MMT. That includes a wheat crop of 50.2 MMT off 87.7% of the planned area and 15.2 MMT of barley off 87.8% of plan. They've also harvested 3.0 MMT of corn off 24% of plan and 3.3 MMT of sunseed off 23.5% of the expected area. The Russian Ministry forecast for a total grain harvest of 90 MMT looks comfortably achievable therefore.

Across the border, Kazakhstan has now harvested over 18.5 MMT of grains off 90% of the planned area. The harvest will be wrapped up by the weekend, producing a bunker weight crop of 20 MMT, say the local Ag Ministry.

Ukraine's grain harvest stands at 41.23 MMT off 77% of the planned area, that’s up from 36.26 MMT at this point last year. The corn harvest is now 30% done at 8.14 MMT.

Ukraine said that they had exported 2.3 MMT of grains in September, and 770 TMT in the first week of October. That brings the 2013/14 marketing year to date total to 6.8 MMT, up 16% on year ago levels. They need to ship 6.5 MMT per quarter to hit the Ministry's target of 26 MMT for the full season.

A report on the Farmer's Weekly website said that British farmers could plant a record wheat area this year, topping the 2.086 million ha planted in 2000. Last year's area was only 1.61 million ha due to the adverse weather conditions. A return to "normal" yields would potentially therefore give us a UK crop of around 16 MMT, maybe more, versus only 12.5 MMT or so this year. That pushed new crop (2014) London wheat lower.

The pound was sharply weaker on the day, due to news that British August industrial production was down, placing thoughts of the fragile UK economic recovery into question. That would normally support London wheat, but not when prices are already too expensive to consider exports.

The Romanian Farmers League estimated Romania’s 2013 corn crop at 9.0 MMT, up more than 50% versus output of 5.95 MMT in 2012.

There's a lot of new crop corn lined up to come into the UK from Eastern Europe/the Black Sea this winter, tapering demand for feed wheat.

USD7/bushel is looking like a tough resistance level to break on Chicago wheat, as is EUR200/tonne in Paris.

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EU Rapemeal Values

09/10/13 -- Rapemeal prices on the continent are weaker, following losses in soymeal values in Chicago overnight and again this morning.

Latest guide prices for EU rapemeal today, basis FOB Lower Rhine in euros/metric tonne, with change from previous trading session:


Chicago Ends Lower On Harvest Pressure

08/10/13 -- Soycomplex: Beans closed lower on harvest pressure and continued reports of better than expected yields. The weather looks favourable for increased harvest activity in the week ahead. Dr Michael Cordonnier apparently raised his forecast for US soybean yields from 40.5 bu/acre to 41.0 bu/acre, pegging production at 3.13 billion bushels. China re-opened after a week long holiday. Despite the holiday Chinese buyers are said to have booked around 8-900 MT of US beans in the past week. JC Intelligence of Shanghai said China had imported 4.9 MMT of beans in September versus 6.36 MMT in August. They estimated China's October bean imports at 4.7-4.9 MMT, rising to around 6 MMT each in November and December. Taiwan's BSPA bought 60 TMT of Brazilian beans for April shipment, they cancelled a tender to buy 40-60 TMT of US beans off the Gulf for Jan shipment due to high prices. Strong global demand for meal has some analysts forecasting that India could export 5 MMT of meal in 2013/14, up 25% from 2012/13. Oil World estimated US Q4 2013 soybean exports at a record 20.0 MMT versus 19.2 MMT a year ago and 14.3 MMT in Q4 of 2011. They said that Brazil had exported 40.6 MMT of beans in the first 9 months of the year and has 1.4 MMT left for export in Q4 of 2013. They estimated Argentina’s Q4 bean exports at 1.74 MMT versus 600 TMT a year ago. Nov 13 Soybeans closed at USD12.88 3/4, down 7 3/4 cents; Jan 14 Soybeans closed at USD12.87 3/4, down 9 1/4 cents; Oct 13 Soybean Meal closed at USD428.70, down USD5.00; Oct 13 Soybean Oil closed at 40.20, up 55 points.

Corn: As with beans, corn closed lower on a pick up in harvest activity now that Midwest showers have cleared away and the weather outlook for the next few days seems conducive for decent progress to be made. The combines will be going flat out ahead of a 6-10 day forecast that shows another round of showers with up to an inch in the Western Plains. Better than expected also remains the theme as far as yields go. Rumours that China had bought substantial volumes of US corn over the past few days were downgraded to a couple of cargoes. They are said to have been looking at sorghum as an alternative. Taiwan bought 60 TMT of Brazilian corn for April shipment. Ukraine weather has improved which should speed up the corn harvest significantly this week and into next. If we believe the Ukraine Ministry then corn plantings in 2014 are set to increase sharply, which could push their crop up to around 35 MMT next year. It was only 10 MMT a few years ago. Reports suggest that the French corn harvest is now underway. The French Farm Ministry cut their forecast for corn production there from 15.6 MMT to 15.5 MMT, although that's still up almost 3% on last year. Production in Eastern Europe is expected to be sharply higher this year. Despite the US government's partial shutdown the Energy Dept are expected to release their weekly ethanol production data tomorrow. Last week's output was 875,000 barrels/day. Dec 13 Corn closed at USD4.41 3/4, down 7 1/2 cents; Mar 14 Corn closed at USD4.54 1/2, down 7 1/4 cents.

Wheat: Wheat closed mixed with the front month Dec 13 Chicago contract shying away from testing the USD7/bu mark. Constant talk of much lower than anticipated winter wheat plantings in Russia and Ukraine are adding support despite the net result of that being many, many months away yet. Whilst Russia growers would probably increase spring wheat plantings to compensate (even though they would yield lower), Ukraine farmers would probably look at other crops such as corn, spring barley and sunflower. Back to what's happening now, the Russia grain harvest stands at 81.3 MMT off 83% of plan, and the wheat harvest at 49.8 MMT of 86.8% of plan. These figures suggest that official Ministry estimates for the 2013 harvest are too low, and by some distance. The Kazakh harvest is 90% done at just over 18.5 MMT in bunker weight. Winter wheat has been planted on 3.6 million hectares in Ukraine, around 54% of the original forecast. "Don't underestimate the speed at which Ukraine soils dry out," said Ukraine agronomist Mike Lee. "Farmers need to plant 140k ha of wheat/day over the next 20 days to hit the target. With current weather forecasts I think that can be done," he added. Trade gossip suggests that Mexico bought wheat from Canada for March/May shipment. French customs data showed that France exported 2.6 MMT of soft wheat between July – August up 17% from a year ago. Dec 13 CBOT Wheat closed at USD6.93 1/2, down 1 1/4 cents; N/P KCBT Wheat closed at USD7.60, up 3 1/2 cents; Dec 13 MGEX Wheat closed at USD7.53, up 2 3/4 cents.

EU Grains Mixed, FSU Plantings Have Late Chance Of Progression

08/10/13 -- EU grains closed mixed, having spent much of the day higher, with Nov 13 London wheat settling GBP0.85/tonne firmer at EUR161.10/tonne and Jan 14 down GBP20.90/tonne at GBP161.60/tonne. Nov 13 Paris milling wheat was unchanged at EUR196.25/tonne whilst Nov 13 Paris rapeseed rose EUR1.50/tonne to EUR368.25/tonne.

The GFS model shows much drier conditions for Ukraine and Russia over the next fortnight, colder than normal temperatures are also seen switching to warmer than expected. Local analysts say that the capability of farmers sowing very significant volumes of winter wheat during this period shouldn't be underestimated, especially given the financial incentive that they have given current corn prices.

The respective local Ag Ministries and those with a vested interest don't necessarily agree. The Russian Ministry now see winter grain plantings at 13 million ha and the Russian Grain Union say 13.0-14.0 million. The original Ministry target was 16.4 million. So far they say that winter plantings have been completed on 8.7 million ha, only just over half of the original plan. A year ago winter plantings were at 12.8 million ha.

In Russia, winter grains typically account for around 40 MMT (circa 44%) of an "average" full season grain production of 90 MMT, although planted area is only around a third of total grain acreage.

Separately the Russian Ministry said that the 2013 grain harvest is 83% done at 81.3 MMT. Wheat accounts for 49.8 MMT of that off 86.8% of the planned area. Thus the official Ministry estimate of a grain harvest of "only" 90 MMT this year looks low, even if it is substantially better than last year's 77.2 MMT output.

Ukraine say that they've planted winter wheat on 3.6 million ha, 54% of the original planned area of 6.7 million ha. APK Inform say that a final area of 5.4 million ha, 17% down on last year might be nearer the mark.

Kazakhstan meanwhile have harvested 18.53 MMT of grains off 90% of the planned area. The Ministry there were predicting a final grain crop of only 15 MMT as recently as August (versus 12.9 MMT in 2012).

There's a little vibe developing that these canny FSU nations may be underestimating 2013 grain production, as well as production potential for 2014, for their own nefarious purposes.

The USDA have apparently confirmed that this Friday's October WASDE report will not be released, placing the market further into darkness.

Informa Economics say that the EU-28 wheat crop this year will amount to 142.9 MMT, up nearly 10 MMT on last year. Russia's crop will total 54.5 MMT, up 44.6%, they add.

Chicago Edges Higher In The Dark

07/10/13 -- Soycomplex: Beans closed mostly around the middle of the day's trading range, 1-6 cents higher. With no official USDA crop progress data to go on the trade is resorting to having to guess. A Reuters poll estimated that the US soybean harvest was possibly around 22% complete, from within a quite wide range of estimates of 16-30%. This possibly highlights how far out some trade ideas could be from reality once we finally do resume getting some numbers from Washington. A week from now those estimates could be 25 percentage points apart. The harvest was officially 11% done a week ago. We should also have had weekly export inspections data from the USDA today, indicating the pace of US exports. These were also missing. A Bloomberg survey was said to have pegged US 2013 soybean yields at 41.6 bu/acre with production at 3.161 billion bushels. The USDA's September estimates were 41.2 bu/acre and 3.149 billion bushels. The Bloomberg survey came up with a lower harvested area estimate than the USDA or production would have been higher. The same survey pegged US 2013/14 carryout at 175 million bushels versus 150 million from the USDA last month. The gist is that a variety of private estimates from Linn Group, FCStone and Informa all agree with this Bloomberg survey that US soybean yields and production are probably higher than the USDA forecast last month. Safras e Mercado said on Friday that Brazilian soybean planting is 2.8% complete versus 3.0% a year ago and 2.4% on average. Rain is gradually creeping into the forecast for for the top producing state of Mato Grosso. Celeres estimated Brazil’s 2013/14 soybean crop at a record 86.2 MMT versus a previous estimate of 85.2 MMT. They said Brazilian growers have sold 30% of their 2013/14 soybean crop versus 46% a year ago. Nov 13 Soybeans closed at USD12.96 1/2, up 1 1/2 cents; Jan 14 Soybeans closed at USD12.97, up 2 cents; Oct 13 Soybean Meal closed at USD433.70, up USD2.40; Oct 13 Soybean Oil closed at 39.65, down 34 points - the second lowest close for a front month in more than 3 years.

Corn: Corn closed 5-6 cents firmer, although front month Dec 13 couldn't manage to break through resistance at USD4.50/bushel, finishing just below that level. In the absence of any data from the USDA, a Reuters survey estimated that the 2013 US corn harvest might be around 20% done versus 28% on average at this time. The range of estimates was 17-27%. Harvesting was officially 12% done as of a week ago. "Harvesting stalled last week where more than 2 inches of rain occurred in SE Minnesota, NW Wisconsin and eastern Nebraska. Ohio and most of Indiana also were hit with strong rain storms, receiving 2.5-3 inch rainfall. Moderate showers occurred in the balance of Midwest farms. This was the wettest week for Midwest corn and soybeans since the beginning of July," said Martell Crop Projections. Bloomberg reported that their survey pegged US 2013 corn yields at an average 157.0 bu/acre from within a range of estimates of 153.2-159.4 bu/acre, versus 155.3 bu/acre from the USDA last month. The survey pegged production at an average 13.836 billion bushels, that's still a record although not much different from last month's 13.843 billion forecast from the USDA. The reason for that is harvested acres being seen at 88 million versus 89.14 million from the USDA in September. There's talk of China buying US corn during the past week as prices dipped to 3-year lows. Safras e Mercado said that Brazil's 2013/14 corn crop is 30% planted versus 27% a year ago. Planting is furthest advanced in the wetter south. Mato Grosso corn planting is 2% complete versus 3.4% on average. They pegged the Brazilian corn crop at 77.0 MMT versus 82.0 MMT a year previously, but significantly higher than the USDA's September estimate of 72.0 MMT. CONAB are due to release their first Brazilian crop production estimates for the new season tomorrow. Ukraine have harvested 6.2 MMT of corn so far from their anticipated record 26-29 MMT crop. A warmer and drier outlook for the week ahead should allow for some significant advancement. The French corn harvest is yet to start, FranceAgriMer reported on Friday. This time last year 6% of the crop had been harvested. Dec 13 Corn closed at USD4.49 1/4, up 6 cents; Mar 14 Corn closed at USD4.61 3/4, up 5 3/4 cents.

Wheat: Wheat closed around 4-7 cents higher on the day, maintaining it's substantial premium over corn. Dec 13 CBOT wheat looks to be lining itself up for a shot at breaking above the USD7/bushel level. A front month hasn't closed that high since June. There's talk that Brazil bought more HRW Wheat on Friday. Iraq, Algeria, Jordan and Bangladesh are all tendering for wheat. India is trying to make it's mind up whether to lower the bar on the wheat it wants to sell, or sit and hope that international prices move back up above USD300/tonne. "Hope isn't much of a strategy," as one trader said to me today. Fund money continues to close out it's short position in CBOT wheat, buying an estimated net 2,000 contracts on the day. Unfortunately we don't have any data from the CFTC from Friday to see how much of their short was closed out last week. The most recent data we have to go on is the The Commitments of Traders reports as of September 24th. That showed Non-Commercial and Non-reportable combined traders holding a net short of 55,392 contracts. As long as they continue to close out that position, CBOT wheat will remain supported. It may be that the ongoing US budget impasse is encouraging them to adopt a "risk off" mentality and exit these shorts, but that doesn't explain why they still seem relatively comfortable keeping their sizable corn short. Everybody, including both the Russian and Ukraine Ag Ministry, are talking FSU winter grain plantings sharply lower, with production being similarly cut for 2014. Russia’s Ag Ministry estimated Russia’s 2014 winter grain area at 13.0 million hectares versus the original target of 16.4 million. SovEcon concur at 13.0-13.5 million. They've currently planted 8.7 million hectares versus 12.8 million this time a year ago. The Ukraine Ag Ministry meanwhile said last week that their 2014 wheat crop could fall by a third. Rewind to 2013 and we find that Russia have harvested 81.3 MMT of grains so far this year off 83% of the planned area, yet the forecast for the full harvest is only 90 MMT. Dec 13 CBOT Wheat closed at USD6.94 3/4, up 7 3/4 cents; KCBT Wheat closed at USD7.56 1/2, up 6 1/4 cents; Dec 13 MGEX Wheat closed at USD7.50 1/4, up 4 cents.

London Wheat Ends At Best Levels Since Late August

07/10/13 -- EU grains closed mostly higher on strong underlying interest on the international tender front and continued concerns over delayed winter wheat plantings in Russia and Ukraine.

The market closed with Nov 13 London wheat settling GBP1.50/tonne firmer at EUR160.25/tonne and Jan 14 up GBP1.75/tonne at GBP162.50/tonne. Nov 13 Paris milling wheat rose EUR1.75/tonne to EUR196.25/tonne whilst Nov 13 Paris rapeseed was down EUR1.25/tonne at EUR366.75tonne.

This was Nov 13 London wheat's first close above GBP160/tonne since late August, despite feed barley being available at a substantial discount. Maybe there just isn't that much feed wheat about thi year. The HGCA report average UK wheat test weights of 77.1 kg/hl this year versus 69.6 kg/hl in 2012. Average hagbergs are very high at 319 - the highest value recorded since 1990, with protein contents coming in at 12.3% and moisture 14.7%.

Will an impeding deluge of new EU/Black Sea crop corn change the feed grain supply and demand dynamics?

Whilst the popular market newswires remain full of stories of planting delays in the FSU, private analysts suggest that things have finally turned drier and warmer, giving winter wheat growers there a potential window of opportunity. "Dry, warm & plenty of soil moisture, forecast for settled two weeks, wheat planting currently going flat out," said Ukraine agronomist Mike Lee on Twitter this morning.

There are various tenders around on the export front. Iraq seeks 50 TMT (but usually buys more) of wheat from the US, Canada, the Black Sea region, Australia and/or Germany. Algeria seeks 50 TMT of optional origin (French would be the favourite) milling wheat for Dec shipment. Jordan seeks 100 TMT of optional origin milling wheat for Feb/April along with 100 TMT of optional origin feed barley for March/May. Bangladesh are also in the market for 50 TMT of optional origin wheat for Nov/Dec shipment.

Copa Cogenca pegged the EU-28 cereal harvest at 298 MMT, up 9.5% on last year. They estimate the wheat crop here (excluding durum) at 134 MMT, up 8.6%, with a durum crop of 8 MMT representing a rise of 2.6% on last year. They also see barley output at 59 MMT, up 7.9%, and corn production at 64 MMT, up 13.2%.

The French Farm Ministry today raised their forecast for soft wheat production there from 36.7 MMT to 36.9 MMT. They tweaked corn output a little lower from 15.6 MMT to 15.4 MMT.

Ukraine's grain harvest now stands at 39.3 MMT, including 6.2 MMT of corn. The Ukraine Ministry said that grain exports this marketing year (to Oct 4) stand up 11.4% on last year at 6.3 MMT, including 3.87 MMT of wheat, 1.7 MMT of barley and 0.75 MMT of corn. They've also exported 1.43 MMT of OSR already in 2013/14.

The Russian Ministry said that they are to defer their intervention purchase program for a week due to the delayed harvest. They are expected to buy 2-3 MMT of grains between Oct 15 and the year end,

SovEcon said that Russia’s winter grain planting area may fall to 13.0-13.5 million ha versus 16.4 million a year ago.

Whilst much of the trade concern is centred around delayed crop planting in Russia/Ukraine, French winter wheat plantings are 9% done versus 3% a year ago, with barley planting 16% complete compared with only 4% this time last year, FranceAgriMer said Friday. UK wheat planting is also well advanced for early October. We can't have a third crop disaster in a row in 2014 can we?

The current UK wheat/barley pricing structure and near ideal field conditions would suggest that winter wheat plantings in the UK should recover strongly, and prospects for production in 2014 currently indicate a potential return to the halcyon days. Certainly a 16 MMT crop could be on the cards, and maybe more.

EU Rapemeal Prices

07/10/13 -- Rapemeal prices on the continent are flat to slightly weaker today. Soymeal values in Chicago were the biggest winners out of a basket of grain futures last week, posting gains of 2.7% week-on-week, versus beans losing 1.9% and soyoil shedding 3.6%.

Latest guide prices for EU rapemeal today, basis FOB Lower Rhine in euros/metric tonne, with change from previous trading session:


Is The Wheat Market Getting A Little Bit Ahead Of Itself?

07/10/13 -- Yes, I know that world demand is good for wheat at the moment, but it needs to be with a record crop to place. Will it stay so buoyant once the impending record world corn harvest is in the bin?

Whilst everyone is getting very excited about slow winter wheat plantings in Ukraine and Russia, nobody is mentioning that European plantings are running well ahead of schedule.

FranceAgriMer said Friday that winter wheat plantings there were 9% done as of Sep 30 versus 3% complete a year previously. Winter barley was 16% done versus only 4% this time last year. Certainly things are much more advanced than they were here in the UK too, and establishment is looking very good indeed. Last week's rains followed by the current warm temperatures won't be doing any harm either to get the crop looking in great shape ahead of the winter.

Incidentally, the weather forecast for the Black Sea countries is now much more benign. My agronomist chum Mike Lee in Ukraine says on Twitter this morning "Dry, warm & plenty of soil moisture, forecast for settled two weeks, wheat planting currently going flat out." What a difference a weekend makes, as any West Ham fan will tell you.

The Ukraine Ag Ministry forecast on Friday that corn plantings there will rise sharply again in 2014, up 700-900,000 ha to 5.5-5.7 million ha. They are already expected to have a record crop in 2013, and domestic prices are said to be below the cost of production for all but immediately available corn to fill up waiting vessels.

Meanwhile the Ukraine Ministry said that wheat production next year could fall by a third to 15 MMT.

What would you do if you were a Ukraine farmer? Plant winter wheat if at all possible, I'd say.

It's funny too how the market choses to focus on what might happen in Russia and Ukraine next summer rather than what has just happened in Canada this year.

In the US meanwhile we have a situation, starved of data as we are, that we can only go on anecdotal reports from the field. They say that US corn yields are probably higher than the USDA's current 155.3 bu/acre.

Informa now say 158.8 bu/acre. Linn Group 159.4 bu/acre and FCStone 157.8 bu/acre - the lowest of the three being 2.5 bu/acre better than Washington's last stab in September.

If the USDA finally concur, whenever it will be that they eventually re-open, it could/should put corn under further pressure. Remember that the seasonal low in corn doesn't usually come until later in the year:

CBOT wheat could ultimately have a tough time attempting to knock on the door of USD7/bu with corn staring at the trap door of USD4/bu.

In Europe, we have a similar situation looming. The flood of anticipated "cheap as chips" Black Sea/Eastern European corn has yet to fully arrive onto the market. Harvest pressure for corn isn't really upon us yet. Ukraine have currently only harvested 6.2 MMT of corn out of an expected 26-29 MMT crop and further west France have yet to begin on their crop.

Note too that Coceral's crop numbers released Friday included huge corn production increases coming from infamous discount sellers like Romania (up 79%), Hungary (up 46%) and Bulgaria (up 39%).

I'm not saying that I'm bearish wheat longer-term, but an imminent slew of cheap corn from these areas and the US could mean that a correction in the wheat market is overdue.

Chicago Closing Comments - Friday Night

04/10/13 -- General Comment: The market continues to seem relatively relaxed about the ongoing partial US government "shutdown" and the lack of data forthcoming from the usual agencies. Today we should have had U non-farm payrolls along with the regular Friday CFTC numbers that reveal fund long or short-holdings in commodities. We didn't get them. Yesterday we missed out on the regular weekly grain export sales figures and on Monday we are due, but don't expect, the latest crop condition ratings and harvest progress stats. Nobody currently seems to know whether to expect next Friday's October WASDE report or not. We are also missing out on any daily announcements concerning large export sales, with private exporters obliged to report anything over 100 TMT to the USDA on a daily basis. There's now a danger of a data overload as and when the USDA finally do return to "business as usual" with potentially a myriad of export sales, missed production estimates and harvest figures to sift through. Surely these won't be released whilst the markets are actually open too will they? Imagine the intra-day volatility that would cause! Meanwhile, we are now in the dark as to the size of the fund position in the grains, with no official data to go on since the close of play a week last Tuesday night (Sep 24). For the time being at least, the shutters on the window of transparency remain closed.

Soycomplex: Beans closed around 6 to 8 cents higher on the day, but with losses of around 25 cents for the week. Informa Economics cut their forecast for 2013 US soybean yields to 41.7 bu/acre versus a previous estimate of 42.4 bu/acre, that added support although that's still higher than the USDA's September estimate of 41.2 bu/acre. They dropped production to 3.176 billion bushels versus a previous estimate of 3.224 billion, although again still higher than the USDA's September estimate of 3.149 billion. Rains this weekend in the Midwest are expected to slow the US harvest, but the outlook for next week is drier. Weather watchers are keeping their eye on South America where it's dry in Argentina and central Brazil. The Department of Rural Economy for Parana state in southern Brazil estimated the state's 2013/14 soybean area at 5.8 million ha, unchanged from a year ago and said that 10% of the crop has been planted versus 2% a week ago. FCStone estimated Brazil’s 2013/14 soybean crop at a record 87.9 MMT versus a previous estimate of 87.47 MMT and 82.0 MMT a year ago. They forecast Brazil’s 2013/14 soybean exports at a record 43.3 MMT versus 41.0 MMT a year previously as they are seen shipping more beans than they crush, a new trend that only began this season. World demand for meal remains strong. There's talk that the US has sold 500 TMT of soymeal to the EU in the past 2 weeks. Asia have also been a featured buyer this past fortnight. Based on the most recent export sales data available cumulative US soybean sales were 69% of the USDA export forecast versus the 5 year average of 47%. Cumulative meal sales were 27.4% versus the 5 year average of 18.8%. Nov 13 Soybeans closed at USD12.95, up 6 3/4 cents; Jan 14 Soybeans closed at USD12.95, up 6 cents; Oct 13 Soybean Meal closed at USD431.30, up USD3.50 Oct 13 Soybean Oil closed at 39.99, down 2 points. Nov 13 beans were down 24 3/4 cents versus last Friday, with meal up USD11.40 and oil down 152 points.

Corn: The corn market was around 4 cents higher on the day, but some 10 cents or so lower on the week. Informa estimated US 2013 corn yields at 158.8 bu/acre versus a previous estimate of 157.6 bu/acre and the USDA's September estimate of 155.3 bu/acre. They put production at a rcord 14.010 billion bushels versus a previous estimate of 13.889 billion and the USDA's September estimate of 13.843 billion. They estimated US corn abandonment at 7.7 million acres versus the USDA estimate of 8.2 million. They forecast the total Brazilian corn crop in 2013/14 at 71.1 MMT, down 550 TMT from previously and down 10.2 MMT from a year ago. They see the Ukraine corn crop at 27.5 MMT, unchanged from their previous estimate (but 1.5 MMT below the USDA) - yet still up 6.6 MMT from a year ago. The Russian corn crop is estimated at 9.3 MMT this year, down 400 TMT from their previous but up 300 TMT on the USDA and 1.1 MMT higher than a year ago. The Buenos Aires Grains Exchange said that corn planting in Argentina is only 8% complete versus 17% a year ago due to dryness. They estimated Argentina’s 2013/14 corn planted area at 3.46 million ha, previous estimate of 3.56 million and down 6% from the 2012/13 area. South Korea cancelled a tender for 140 TMT of optional origin corn for March shipment, saying that they expect prices to fall further. Coceral estimated the 2013/14 EU-28 corn crop at 65.39 MMT versus previous estimate of 66.2 MMT, but up 14% on last year's 57.37 MMT. Huge production increases are seen coming from discount sellers like Romania (up 79%), Hungary (up 46%) and Bulgaria (up 39%). The Ukraine Ag Ministry estimated the 2013 corn crop at a record 29.0 MMT, up 39% versus 2012. They also said that plantings for 2014 would rise further, to 5.5-5.7 million ha versus 4.8 million this year due to winter wheat plating problems. Dec 13 Corn closed at USD4.43 1/4, up 4 cents; Mar 14 Corn closed at USD4.56, up 4 cents. Dec 13 was down 10 3/4 cents on the week, with Mar 14 down 10 1/2 cents.

Wheat: Unlike the other two markets, wheat was lower on the day but higher for the week. Stats Canada forecast a record wheat crop there of 33 MMT, up 22% on last year. In Alberta, Canada’s second biggest wheat producing province, the outlook is exceptionally good. The most recent crop report was full of superlatives note Martell Crop Projections: “Reported yields are exceptional with the quantities being the highest ever reported for virtually all crops in all regions. 2013 yields are anticipated to be 20–25% above the average of the last 5 years. The cooperating dry weather is also providing above average quality with 93% of the spring wheat, 94% of the barley, 90% of the oats and 98% of the canola falling in the top two grades." In Saskatchewan, Canada's largest wheat province, very good yields are also being indicated this harvest, despite a very dry finish to the growing season. This appears to be due to "the tank was full in June and July" offsetting August dryness which also kept pest and disease losses to a minimum, they add. Coceral estimated the EU-28 all wheat crop at 143.3 MMT, up 7% versus last year's 133.9 MMT. The Buenos Aires Grains Exchange said that 26% of Argentina's wheat crop is in fair/poor condition, up 2 points on a week ago. In southern Argentina winter wheat areas received beneficial rainfall this week and the weather is finally turning warmer. Northern Argentina is still dry. Informa cut their Argentine wheat crop estimate to 11.0 MMT, down 2.7 MMT from their previous forecast, although still up 1.5 MMT from a year ago. On the export front there's talk that Brazil has bought 200 TMT of US hard wheat for Nov/Dec shipment this week, taking their total purchases of US wheat so far this year to 3 MMT. There's lots of talk that widespread rains in Russia and Ukraine will cut winter wheat plantings for the 2014 harvest quite sharply. However, the Russian and Ukrainian weather forecast is trending warmer and drier in the next 5-7 days. Informa estimated the 2013 Russian wheat crop at 54.5 MMT, up 1 MMT from their previous estimate and up 16.8 MMT from a year ago. Dec 13 CBOT Wheat closed at USD6.87, down 2 1/4 cents; Dec 13 KCBT Wheat closed at USD7.50 1/4, down 5 1/4 cents; Dec 13 MGEX Wheat closed at USD7.46 1/4, down 4 cents. Chicago wheat was up 4 cents on the week, with Kansas rising 18 1/2 cents and Minneapolis up 14 3/4 cents.

EU Grains Lower On The Day. Higher On The Week

04/10/13 -- EU grains closed mostly lower on the day but higher for the week. Strong demand underpins the market, re-enforced by last night's weekly export data from Brussels showing 746 TMT of soft wheat export licences were issued this week, the best total of the 2013/14 campaign so far.

Nov 13 London wheat settled GBP0.90/tonne easier at GBP158.75/tonne, whilst Jan 14 was also GBP0.90/tonne lower at GBP160.75/tonne. Nov 13 Paris milling wheat fell EUR0.50/tonne to close at EUR194.50/tonne. Nov 13 Paris rapeseed was down EUR0.75/tonne at EUR368.00/tonne.

For the week London wheat was up GBP2.50/tonne, with Paris wheat up EUR1.00/tonne and Paris rapeseed EUR0.75/tonne firmer.

Coceral raised their EU-28 soft wheat production estimate by 4.5 MMT from their June estimate to 135.2 MMT, a 7.6% increase on last year. Add on durum wheat output of almost 8.1 MMT and that gives us an all wheat crop of 143.3 MMT in Europe this year, which is 9.4 MMT higher than last year and 0.4 MMT above the USDA's September estimate.

Coceral have the UK wheat crop at a shade under 12.5 MMT versus 12.1 MMT from the USDA.

Coceral now forecast the EU-28 barley crop at 49.8 MMT, up 17.7% compared with a year ago. That includes a 34.5% hike in production here in the UK to 7.4 MMT. The EU-28 oilseed rape crop is now seen at 20.7 MMT, up 6.7% versus 19.4 MMT last year, with output in the UK down 15.4% to 2.15 MMT.

Russia's grain harvest lumbers on at 80 MMT off 78.3% of the planned area. Wheat accounts for 48.9 MMT off 81.1% of the anticipated area, barley is at 15 MMT off 83.2% and corn at 1.9 MMT off 15.8%. The FAO forecast Russia's grain crop at what therefore seems an unambitious 87.4 MMT, even though that is up 25.6% on last year, although it should be noted that the Russian Ministry's 80 MMT figure will be based on "bunker weight" before screenings etc are removed.

The FAO see Russia's grain exports rising by a third to 20 MMT in 2013/14, with wheat accounting for 14.5 MMT of that, along with 2.7 MMT of corn and 2.6 MMT of barley.

The Kazakh harvest is getting there at almost 17.5 MMT off 85.7% of plan. This time a year ago they'd harvested just over 14 MMT off 99% of plan. The Kazakh Ministry forecast a clean weight grain crop of 18 MMT, up 40.6% on last year.

The trade is awash with talk of winter planting in Russia and Ukraine being badly disrupted by constant rain. Although next week's forecast is drier, it is also colder. Ukraine agronomist Mike Lee says that he's still planted a viable winter wheat crop in November in Ukraine.

The Ukraine Ag Minister suggests that wheat production in 2014 could drop by a third to 15 MMT. Winter wheat planting is said to only be around a third done (as of Sep 30) at 2.2 million hectares. This time last year 4.6 million hectares of winter wheat were already in.

Meanwhile, Russian farmers have only sown around half of the expected 16.4 million hectares of winter grains for the 2014 harvest. This time last year they'd got more than three quarters of that area planted.

Back to this season, the pace of Ukraine grain exports is up on last year, although behind that needed to hit the 2013/14 Ministry forecast of 26-30 MMT. We're already a quarter of the way through the season and they've only exported 5 MMT of their exportable grain surplus - and that's without the addition problem of any freeze-related disruptions.

The Economy Ministry forecast 2013/14 grain production at 58 MMT, including 22.2 MMT of wheat, 7.5 MMT of barley and 26 MMT of corn. Domestic grain consumption in Ukraine is seen at around 28.5 MMT. What doesn't get exported this time round will of course be carried over into next season, making beginning stocks for 2014/15 much more sizable than they were at the start of the current season. A cynic might say that might be why they are already talking next year's output down?

Closer to home, FranceAgriMer today said that the average protein content of this year's French wheat crop was 11.2%, with test weights averaging 77.6 kg/hl, moisture 13.5% and that almost all the crop had a hagberg falling number of at least 220. They expect French wheat exports of 18 MMT (of which 11 MMT will go to non-EU destinations).