EU Grains Recovery Continues

Posted by Nogger - a legend in his own mind at 18:34 | Categorized as

07/03/16 -- EU grains closed firmer, with London wheat posting a third successive session of gains.

At the finish, front month Mar 16 London wheat was up GBP1.40/tonne at GBP101.55/tonne, Mar 16 Paris wheat rose EUR2.50/tonne to EUR143.25/tonne, Jun 16 Paris corn was up EUR1.25/tonne to EUR153.00/tonne and May 16 Paris rapeseed jumped EUR3.75/tonne to EUR353.75/tonne.

Crude oil continues it's recovery, adding support to the grains sector. The size of fund money's short position in US grains also leans friendly, as too does farmer lack of selling at these levels.

With Russia and Ukraine closed for a holiday, there was no fresh news coming from that direction.

Exports out of the region continue at a brisk pace though. Russia's and Ukraine's seaports both shipped out large of grains last week, according to Agritel.

Russia are majoring on wheat, which was responsible for 470 TMT worth of exports last week, along with 110 TMT worth of corn. Ukraine meanwhile exported more than 580 TMT worth of corn and 200 TMT of wheat last week also.

Elsewhere, Turkey were reported to have bought 25,000 MT of Russian wheat on Friday.

The HGCA reported a reduction in the English and Welsh winter wheat planted area (as of Dec 1) to 1.66 million ha, some 3% less than the area harvested in 2015.

Winter barley plantings were 2% down at 370k ha, and rapeseed continues to be our of favour, falling 10% to 548k ha.

Helen Plant, AHDB Senior Analyst, said: “Market conditions continue to challenge the economics of the whole rotation, but especially oilseed rape, which shows the largest declines year on year. While still an important break crop, the fall in area shows the increasing risks of growing oilseed rape are outweighing the potential rewards on offer from current forward prices.”

"Unless spring plantings are substantially higher than in the last two years, this sets England up for the lowest oilseed rape area since 2009. The total area planted in 2009 was 536K ha, of which 493K ha was winter sown," the report said.

Barley plantings, whilst slightly lower than a year ago, still remain historically high, they noted.