EU Grains Mostly Higher, Although Fresh News Scarce

18/01/16 -- EU grains finished mixed, but mostly a touch higher, with little in the way of fresh inputs with US markets closed for Martin Luther King Day.

At the close of trading, Jan 16 London wheat was down GBP0.50/tonne at GBP109.10/tonne. In Paris, Mar 16 wheat rose EUR0.25/tonne at EUR165.50/tonne, Mar 16 corn was unchanged at EUR155.00/tonne and Feb 16 rapeseed was up EUR0.75/tonne to EUR358.00/tonne.

Brent crude did little to calm market nerves, dipping below $28/barrel for a new 12-year low as Iran welcoming back to the fold threatens to add yet more crude oversupply to the market.

The pound was firmer for a change, although that did little to help London wheat today.

Even so, Credit Suisse became the latest analyst to do an about turn on their forecasts for sterling, saying that the threat of a Brexit (and a referendum on such) could see the EUR/GBP hit 0.70 within the next 3 months. They'd previously been forecasting 0.77, so this represents significant a 10% change of heart.

On the international tender front, Thailand were said to have bought 50,000 MT of US spring wheat for March shipment, Indonesia booked 55,000 MT of Australian wheat also for March delivery and South Korea's NOFI purchased 13,000 MT of optional origin feed wheat for Feb/Mar. The latter were also said to have passed on a tender for 50,000 MT of feed wheat citing high prices.

India said that they'd planted 28.9 million ha of wheat for their 2016 harvest, which is 5% down on year ago due to heat/dryness.

Russia said that their 2015 grain harvest ended up at 104.3 MMT, which is only 1 MMT down on a year ago. Wheat accounted for 61.8 MMT of that, up 3.5% compared to 2014. Corn came in at a record 12.7 MMT versus 11.3 MMT in 2014 on a combination of increased plantings and a sharp rise in yields.

The Russians also produced a record 2.6 MMT soybean crop in 2015, and increased sunflower output by 8.2% to 9.2 MMT.

Spanish analysts AgroMarketInfo estimated the 2016 soft wheat crop there at 5.585 MMT versus 5.161 MMT last year. They see imports falling from 4.075 MMT to 3.825 MMT.

Likewise, they estimate the Spanish barley crop to rise from 6.796 MMT to 7.431 MMT, and imports falling from 795 TMT to 550 TMT.

Ditto, Spanish corn production will increase from 10.404 MMT to 10.927 MMT, and imports drop from 6.25 MMT to 5.80 MMT, they add.