EU Grains Rise, Exports Remain Strong

23/04/15 -- EU grains closed mostly a little higher for once, with Paris rapeseed pushing on to a fresh near one year closing high for a front month.

At the finish, May 15 London wheat was up GBP2.20/tonne at GBP115.30/tonne; May 15 Paris wheat was EUR1.50/tonne higher at EUR185.00tonne; Jun 15 Paris corn was up EUR0.50/tonne at EUR162.00/tonne; May 15 Paris rapeseed was EUR3.25/tonne higher at EUR378.50/tonne.

Has feed wheat simply gotten to cheap? The HGCA reported that the price of imported feed wheat is now cheaper that barley for the first time since last September.

It's only cheaper by GBP1.00/tonne, but nevertheless that is something of a rarity.

"Despite the large UK barley crop this year, feed barley prices have stayed relatively close to wheat. The large supply of feed wheat in the EU and export demand for barley to non-EU countries can be cited as the main reasons for this," they said.

Strong demand for barley from the likes of China this season may also be a factor supporting global barley prices relative to those of wheat.

Attention is now shifting to new crop prospects.

Offre et Demande Agricole estimated this year's average French wheat yields at a 3-year high 7.63 MT/ha, up 2% versus 7.48 MT/ha a year ago.

Recall that the French Ag Ministry estimate soft wheat plantings there at 5.179 million ha, the highest in more than two decades.

Combine the two and that would give us a French soft wheat crop of 39.5 MMT this year, some 2 MMT more than last year. A significant increase given that FranceAgriMer already estimate soft wheat carryover at the end of the current season to be more than 20% higher than those of a year ago.

The French continue to make a sterling effort on the export market though, aided by the weak euro. The leading French grain export hub of Rouen had a bumper week of exports again this past 7 days, shipping out nearly 250 TMT of grain. That total included soft wheat for Morocco, Thailand and South Korea, along with feed barley destined for China.

The EU confirmed another week of strong exports, with 679 TMT worth of soft wheat export licences being issued, taking the cumulative season so far total to 27.1 MMT, some 9.7% ahead of this time last year.

They also approved 142TMT worth of barley exports, taking the season so far total to 7.4 MMT, up 42.3% versus this time last year.