EU Grains Mostly Higher On The Day, Little Changed For The Week, Although Rapeseed Dives

25/04/14 -- EU grains closed mostly higher on the day, although little changed for the week. The exception was front month May 14 Paris rapeseed, which expires next Wednesday, which has taken something of a battering over the last few days.

May 14 London ended GBP2.00/tonne higher at GBP170.00/tonne, and new crop Nov 14 rose GBP1.60/tonne to GBP159.75/tonne. May 14 Paris wheat closed up EUR1.25/tonne at EUR217.25/tonne, Jun 14 Paris corn fell EUR0.75/tonne to EUR187.25/tonne and May 14 Paris rapeseed plunged EUR10.75/tonne to EUR396.00/tonne.

For the holiday-shortened week, May 14 London wheat was 15 pence lower, and new crop Nov 14 was GBP1.75/tonne lower. May 14 Paris wheat fell 25 euro cents, Jun 14 Paris corn was 75 euro cents lower, whilst May 14 Paris rapeseed crashed EUR27.75/tonne. Aug 14 will be the new front month on Paris rapeseed once the May 14 contract goes off the board next week. That closed at EUR368.25/tonne today, for a loss of EUR4.50/tonne.

The outlook for the EU-28 2014 rapeseed crop is promising, with production of around 21.1-21.6 MMT expected (versus around 20.8 MMT last year), depending on who's estimate you run with. The French, German and Polish rapeseed crops are all said to be around 2-3 weeks ahead of normal maturity, and have benefited from recent rains, and there's more in the forecast. Early and longer lasting flowering should bode well for final yields.

Winter wheat crops in France and Germany are also advanced after a generally mild winter. FranceAgriMer said today that 89% of the French winter wheat crop is at the 2 node stage, up from 67% a week ago and compared to only 20% this time last year. The wheat crop has now started heading in some regions, and winter barley is 12% heading nationally versus zero twelve months ago. Corn planting meanwhile is 68% complete, up 29 points in a week and versus only 25% sown this time a year ago.

French winter wheat is rated 74% good/very good, down a point on a week ago but up compared to 68% this time last year. Winter barley rated good/very good is 71% versus 73% last week and 67% a year ago.

The International Grains Council today forecast the EU-28 2014/15 all wheat crop at 144.8 MMT, up 1.8% on last year's 142.2 MMT. Exports will fall from this season's all time high of 31.2 MMT to 25.3 MMT, they said. EU-28 ending stocks are placed at 10.3 MMT in the season ahead versus 9.0 MMT this year.

The IGC estimated Russia's 2014/15 wheat crop at 51 MMT versus 52.1 MMT last year. They see output in Ukraine falling from 22.3 MMT to 20 MMT.

The EU-28 corn crop this year will total 65.3 MMT versus 64.5 MMT in 2013/14. Production in Ukraine will drop to 26.8 MMT from 30.9 MMT, they added. Ukraine's corn exports will fall from a record 20 MMT this season to 18 MMT in 2014/15, they forecast.

Russia's Ag Ministry said that the country had planted 4.8 million hectares of spring grains so far, which is around 15% of the intended area. Spring barley accounts for 2.6 million ha of that (29% of plan), with spring wheat at 433k ha (3.3%) and corn at 683k ha (26%). The Russian Ag Minister said that the country could produce 95-97 MMT of grains this year, if the weather is conducive.

The Ukraine Ag Ministry meanwhile said that only 1% of this year's winter grains had failed, a historically low number. They said that 94% of winter grains were in good to satisfactory condition, which is also better than normal.

Ukraine early spring grains have now been planted on 2.6 million hectares, along with a further 1.4 million ha of corn. Sunflower planting is past halfway at 2.2 million ha and 12% of the anticipated soybean area has also been sown, the Ministry said.

Ukraine's grain exports for the season so far currently stand at 29.13 MMT, including 18.4 MMT of corn, 8.2 MMT of wheat and 2.2 MMT of barley.

The developing political situation in Ukraine is keeping the market nervous. Deteriorating US winter wheat conditions are also supportive, as is the delayed start to US spring corn plantings in the Midwest, for now.