EU Grains Mostly Higher, Russian Concerns Remain

05/10/15 -- EU grains began the new week mixed, but mostly a touch higher, despite the news that Egypt's GASC snubbed French wheat in favour of Russian and Ukraine origin material again over the weekend.

At the close, Nov 15 London wheat was down GBP0.30/tonne at GBP115.25/tonne. In Paris, Nov 15 wheat was up EUR0.50/tonne at EUR176.25/tonne, Nov 15 corn was up EUR1.75/tonne to EUR163.75/tonne and Nov 15 rapeseed was EUR4.75/tonne higher at EUR373.25/tonne.

The results of the latest GASC tender saw them booking 235,000 MT of mostly Russian wheat, although that total also included one 60,000 MT cargo of Ukraine origin.

GASC have bought 1.7 MMT of wheat so far this season, and 1.1 MMT of that has been of Russian origin.

The average price paid this time was said to be a little over $190/tonne FOB for Nov 1-10 shipment. French wheat maybe took some heart from the news that it was only the cheaper Black Sea freight that prevented it from being the lowest offer on the table. French wheat was offered at a best price of just under $190/tonne.

Russian seaports were said to have exported 632.1 TMT of grains last week, up 41.5% on the previous week, That included 472.2 TMT of wheat, 69.4 TMT of barley and 84.7 TMT of corn.

In contrast, Ukraine's exports via seaports fell almost 31% to 486.2 TMT, including 389.9 TMT of wheat, 43 TMT of barley and 53.3 TMT of  corn.

FranceAgriMer said that the 2016 French winter wheat crop was 3% planted as of last Monday, 4 points behind last year's pace. French winter barley sowings are also 3% done which is 8 points down on a year ago.

The past 14 days have been unusually dry across France, and indeed the UK, Germany, Spain and much of Poland too, which seems to be holding up winter seeding a little. Wetter weather is in the forecast for many in the 15 days ahead though.

The recent French dryness has allowed the corn harvest there to advance to 9% complete as of last Monday, 7 points ahead of progress this time last year.

The largest silo operator in the French port of Rouen, and one that is one of the few approved delivery point against the MATIF milling wheat contract, is said to be re-opening it's doors for intake of wheat today. They are expected to be busy, so may not remain open for too long.

Iraq have tendered for 50,000 MT of US, Canadian, Australian and/or Russian wheat, but are expected to buy more if they hold true to form.

Strategie Grains estimated the EU-28 rapeseed area for the 2016 harvest at 6.5 million ha versus the 2015 area of 6.4 million ha.

Concerns over Russian dryness continue. "Drought has not yet been resolved in European Russia. The past 15 days have not seen a drop of rain in the vast winter wheat belt. September temperatures were unseasonably hot in the key Southern District, 8-10 F above normal. Field moisture has become severely depleted hampering wheat sprouting and development," said Martell Crop Projections.

"There were a few showers in late August-early September, though with the recent heat and intense drying wheat has been slow to germinate," they added.

Forecaster Speedwell said that only scattered light rains are in the forecast for the next 2 weeks, and that Russia may get the first frost of winter next week.