EU Grains Mostly Lower Again
15/07/14 -- EU grains closed mostly lower, as the fall out from last Friday's bearish USDA report continues.
New crop Nov 14 London wheat finished GBP0.90/tonne lower at GBP128.80/tonne, Nov 14 Paris wheat was down EUR1.75/tonne to EUR177.00/tonne, Aug 14 Paris corn was unchanged at EUR167.00/tonne and Aug 14 Paris rapeseed finished EUR1.50/tonne weaker at EUR330.00/tonne.
Paris wheat slumped to a fresh 2 1/2 year low as an attempt to rally back up above the psychologically important EUR180/tonne level failed, whilst for London wheat this was a new 4 year low.
The minutiae of Friday's USDA report reveals improved crop production prospects for parts of Europe, including the UK and Germany, along with Ukraine.
The USDA raised their forecast for the UK wheat crop in 2014 from 15.15 MMT to 15.30 MMT, a 28% jump on last year. They also increased the potential size of the German wheat crop from 24.3 MMT to 25.6 MMT and raised Ukraine by 1 MMT to 21 MMT.
Although they left their estimate for the UK 2014 barley crop unchanged from last month at 5.9 MMT, they raised their outlook on Germany's barley production from 10.22 MMT to 10.58 MMT, and increased Ukraine's barley output from 7.0 MMT to 7.8 MMT.
Russia said that it had now harvested over 20 MMT of grain, with average yields coming in at 3.55 MT/ha, a rise of over 15% versus 3.08 MT/ha this time a year ago.
On a national level the Russian wheat harvest is said to be 16.4% complete at 14.9 MMT, with the barley harvest 7.7% done producing a crop of 2.4 MMT so far.
The Ukraine 2014 grain harvest has produced more than 12 MMT so far, including 7.6 MMT of wheat where yields are averaging 3.2 MT/ha, and 4.3 MMT of barley at 2.77 MT/ha. Average grain yields this time a year ago were only 2.7 MT/ha.
Yields should improve as the harvest progresses into the generally more productive areas, said Agritel. They raised their forecasts for both Russian and Ukraine wheat production this year, although suggested that around only 50% of the Ukraine crop might make milling standard as opposed to 70% last year.
Russian origin grain was said to be the cheapest offer in an Iraqi tender for 50,000 MT of hard wheat at $308.58/tonne CIFFO. Ukraine wheat was offered at $311.15/tonne versus Canadian at $324.59/tonne, Australian at $343/tonne and US wheat at $362.96/tonne.
Ukraine new crop corn prices continue to tumble, with FOB offers now said to be around $192/tonne, the equivalent of around GBP112/tonne.
