EU Grains Little Changed With US Markets Shut

01/09/14 -- As is often the case, with US markets closed for the Labor Day holiday, this was never going to be a thriller - and so it proved with little change either way in thin volume.

The day ended with Nov 14 London wheat down GBP0.25/tonne at GBP121.55/tonne, Nov 14 Paris wheat fell EUR0.50/tonne to EUR173.75/tonne, Nov 14 Paris corn was unchanged at EUR151.75/tonne and Nov 14 Paris rapeseed was EUR0.25/tonne lower at EUR323.50/tonne.

FranceAgriMer told us on Friday that the French early grain harvest was now just about over. As yet, there's little definitive news regarding the quality of this year's wheat crop, save for the fact that it's down on last year.

Meteo France said that the Jul/Aug period was the wettest since 1959, with the country getting 40% more rainfall than normal.

News emerged last week that as well as buying Lithuanian and UK wheat, the French were also importing from Latvia to bolster up the quality of this year's harvest, even if Algeria have already stated that they won't accept wheat of two different origins against any of their tenders.

This still leaves an unusually large volume of French feed wheat to market this year, and unlike UK growers they are keen to find export homes, so French wheat is currently priced well under UK origin material at the moment.

The jury is still out with regards to the quality of this year's German wheat crop, with an estimated 10% or so still to be harvested. The German Ag Ministry seem to think that "rain makes grain" as far as quantity is concerned though, on Friday they raised their estimate for this year's wheat crop to almost 28 MMT, a near 12% rise on last year.

They also forecast a 2014 German winter barley harvest 13.5% higher than a year ago at 9.5 MMT, along with a 7.9% rise in spring barley production to 2.1 MMT and a 4.9% increase in corn output to 4.6 MMT.

In addition they pegged the 2014 German rapeseed crop at 6.2 MMT, a 7.7% rise versus last year.

There's been no improvement in the situation in eastern Ukraine over the weekend, although grain exports from the country remain apparently unhindered. APK Inform said that Ukraine's seaports had exported 664 TMT of grains in the past week, a 13% increase on the week before. That total included 393 TMT of wheat and 271 TMT of barley.

It remains to be seen whether Ukraine growers will plant a normal winter grains area this year, or wait until the spring to see if there's been an improvement in stability in the region.

Russia's harvest juggernaut rolls on. They've now produced 74.3 MMT of grains this harvest, off barely more than half the planned area - 55.6% in fact. Wheat accounts for 47.3 MMT of that total, and barley a further 16.9 MMT. They are just getting going on corn, which is 2.6% harvested producing 385 TMT to date.

SovEcon said that they expect Russia to have exported a record 4.1 MMT of grains in August, most of which (3.7 MMT) will have been wheat. July exports of 3.2 MMT were a record for that particular month as they waste no time in turning what looks like being a very large, possibly post-Soviet era record, harvest into cash. The weak rouble is making domestic prices a bit more palatable.

Turkey are shopping for 200 TMT of milling wheat for Sep/Oct and Oct/Nov shipment, with Russian origin possibly the most likely source.