EU Grains Mixed, Russian Crop Conditions Seen Improving Following Heavy Rains

22/04/15 -- EU grains closed mixed in a no news sort of a day.

The session ended with May 15 London wheat up GBP0.25/tonne at GBP113.10/tonne, May 15 Paris wheat was EUR0.75/tonne higher at EUR183.50/tonne, Jun 15 Paris corn fell EUR0.25/tonne to EUR161.50/tonne and May 15 Paris rapeseed was down EUR0.50/tonne to close at EUR375.25/tonne.

Rapeseed still hovers close to a near one year high, whilst London wheat still languishes close to the lowest levels seen on a front month since mid-October last year.

Recent rains are said to have improved the chances of winter grains in Russia making a decent crop, with IKAR yesterday upping their forecast for wheat production there this year to 54-59 MMT.

"Showers the past 30 days have increased sharply, a wide swath from central Ukraine northeastward to the central Volga District. Top wheat districts Krasnodar, Stavropol and Rostov received drenching rain, 150-200% of normal. Volgograd, a lesser winter wheat district, also received strong showers," said Martell Crop Projections.

The Russian government picked up almost 74 TMT of grain at intervention today, including more than 63 TMT of wheat, as farmer selling picks up in an effort to generate enough cash to fund their early spring grains planting programme.

That remains behind last year's pace, with 2.8 million ha sown so far (9.1% of the government forecast) versus 3.7 million ha this time in 2014 - a shortfall of 24%.

Corn planting is also lagging, at 13.3% done on 372k ha, which is 19% behind the 462k ha sown this time last year. Planting of spring rapeseed is also behind schedule.

How much of that is due to the recent rains, and how much is down to a general lack of cash, remains to be seen. Either way, the Russian government aren't likely to report final spring plantings at much below the levels currently forecast, even if they are.

President Putin appointed himself a new Agriculture Minister today, Alexander Tkachev, described by the FT as one of his "most loyal lieutenants"  - so there isn't likely to be any "boat rocking" going on there.

UkrAgroConsult estimated Ukraine's 2015 grain crop at 53.9 MMT versus 59.4 MMT a year ago. They see corn output down only relatively modestly, at 24 MMT versus 25.9 MMT in 2014, with exports next season at 16.17 MMT versus 18.5 MMT in the current marketing year.

The German Stats Office said that grain exports in the first 8 months of the 2014/15 season (Jul/Feb) were 10% down at 10 MMT. Exports to fellow EU countries fell from 5.5 MMT to 4.6 MMT, and those to non-EU destinations were down from 5.7 MMT to 5.3 MMT.

Overall wheat exports were only down slightly year-on-year, from 6.6 MMT to 6.5 MMT. Barley exports were down 22%, from 1.8 MMT to 1.4 MMT.

German grain imports were also lower in the period, down from 7.2 MMT to 6.8 MMT, although imports of wheat were 14% higher at 3.2 MMT.

Syria said that it had bought 150 TMT of soft milling wheat of unknown origin, but thought most likely to be sourced from the Black Sea, paying EUR216/tonne on a cost and freight (C&F) basis.