EU Grains Rebound From Recent Slump

03/04/14 -- EU grains traded mostly firmer, as US wheat rebounded a little from it's slump, although fresh news was relatively limited.

The day ended with May 14 London wheat up GBP1.00/tonne to GBP163.75/tonne, and with new crop Nov 14 London wheat closing GBP0.85/tonne firmer at GBP153.50/tonne. May 14 Paris wheat closed EUR0.25/tonne higher at EUR206.75/tonne, Jun 14 Paris corn was up EUR1.00/tonne at EUR185.75/tonne, whilst May 14 Paris rapeseed rose EUR1.25/tonne to close at EUR411.00/tonne.

The April look at global crops from the FAO's Agricultural Market Information System (AMIS) left world wheat production in 2013/14 unchanged at a record 716 MMT, which is 3 MMT more than the USDA currently estimate.

The world corn crop in 2013/14 was raised 4 MMT from last month to a new all-time high of 1.01 billion MT. This was due to "reflecting upward adjustments in several CIS and Southern American countries," they said.

"In Russia conditions are good in most growing regions, however, some fields in the south may have been affected by frost damage due to a sharp cold snap in early March. The crop is mostly in vegetative growth phase, having broken winter dormancy early due to the unseasonably warm weather.

"In Ukraine, conditions remain generally favourable although subsurface moisture is low in many areas due to persistent dryness. Winter crops have resumed vegetative growth in most growing regions. In the EU overall prospects are promising.

"Europe continued to experience warmer than usual weather and therefore winter crops are advanced in western and central Europe. Frost kills were very limited but risk of damage is still possible in north-eastern Europe in case of an early spring frost. A dry period since the beginning of March improved the excessively wet situation that affected several regions and provides favourable conditions for field-work and sowing of spring cereals. By contrast, the Czech Republic, south-eastern Germany, and Bulgaria, experienced one of the driest winters and therefore rain is needed," they observed.

MDA Crop Cast forecast the world corn crop rising 2.1% this year, helped by a jump of 4.3% in the US despite the anticipated lower planted area due to better yields.

They also estimated a sharp rise in global soybean production for 2014/15, up 8% to 292.62 MMT. America will see a 12.6% rise in output to a record 97.71 MMT, whilst Brazil is set to harvest 10.8% more than this year's record with a crop of 95.67 MMT. India and Paraguay too will see significant percentage increases in soybean production, they said. It is to be hoped that world demand, and that from China in particular, holds up in 2014/15 with all these extra soybeans in the pipeline.

Ukraine indicate that early spring plantings are well ahead of a year ago and that everything is going well. Agritel note that most of what has been planted so far this year is the relatively "low maintenance" crop that is spring barley. "For crops that are more expensive to produce such as corn, the financial health of the majority of farms suggests a decline in plantings," they suggest.