EU Grains Follow US Market Higher

30/09/15 -- EU grains have followed US markets mostly a little bit higher, in cautious trade ahead of the USDA's quarterly stocks report and revised US wheat production numbers due this afternoon.

At the close, Nov 15 London wheat was up GBP0.10/tonne at GBP115.60/tonne. In Paris, Nov 15 wheat was up EUR0.75/tonne at EUR174.50/tonne, Nov 15 corn was down EUR1.25/tonne to EUR161.25/tonne and Nov 15 rapeseed was EUR0.25/tonne higher at EUR367.50/tonne.

Ahead of the USDA data, fresh news is once again fairly thin on the ground.

The EU Commission did however give us some revised 2015 EU-28 crop production, export and stocks estimates today. They included a hike in soft wheat production this year from a previous forecast of 140.7 MMT to 144.6 MMT. The EU barley crop was estimated at 59.0 MMT versus a previous estimate of 57.2 MMT. Rapeseed rose to 21.1 MMT from a previous estimate of 20.8 MMT. Corn production was reduced a little to 58.4 MMT versus a previous estimate of 58.7 MMT.

The wheat production figure is somewhat below last week's 148.2 MMT forecast from Coceral. Ditto also for barley which the latter had at 60.3 MMT, rapeseed (21.4 MMT) and corn (59.5 MMT).

For soft wheat though, lower projected exports in 2015/16 are the main problem, the EU Commission has these at "only" 27.9 MMT, a more than 16% decline on 33.34 MMT last season. That raises carryout at the end of this season to 14.48 MMT, up 32% compared to 2014/15 ending stocks, and the highest since 2009/10.

Russia said that it's 2015 grain harvest juggernaut is grinding on, with 38.8 million ha, or 82.6%, of the crop now cut, producing 96.1 MMT so far and yields averaging 2.42 MT/ha. A year ago they'd completed harvesting on 38.0 million ha for a crop of 96.1 MMT, with yields at 2.53 MT/ha.

The Russian wheat harvest is said to be complete on 24.2 million ha (versus only 21.1 million a year ago). That's over 90% of the planned area, producing 60.7 MMT so far (57.8 MMT a year ago), with yields down 8.4% at 2.51 MT/ha.

The Russian barley harvest is complete on 7.7 million ha (8.5 million a year ago), or nearly 86% of the expected area, for a crop of 17.4 MMT to date (20.3 MMT in 2014 at this time). Yields here are coming in 5.4% lower that last year at 2.27 MT/ha.

Corn harvesting is approaching a third complete at 4.4 MMT, with yields slightly higher than a year ago at 5.03 MT/ha.

Winter plantings for the 2015 harvest are complete on 11.4 million ha, or 68.3% of the anticipated area, which is 0.5 million ha more than this time last year.

Dryness remains, which may explain why planting is ahead of last year's pace, but the region could do with some rain now. The GFS weather model remains pretty dry across the next 15 days, save for the extreme south of the country. Ukraine is also set to receive below normal rainfall across the next two weeks, according to the same forecast.

Other weather models offer a slightly more extended chance of rain in southern Russia and western Ukraine, but keep central Russia and eastern Ukraine drier than normal.

Kazakhstan said that they'd completed harvesting on 11.4 million ha, or 77.3% of plan, producing a crop of 13.76 MMT so far versus 12.83 MMT a year ago. The harvest there should be wrapped up in the next 10-15 days, according to the Ag Ministry there.