EU Grains Rise Despite Laqrgely Favourable Outlook

19/04/16 -- EU grains traded mostly firmer for a second day, with May 16 London wheat closing GBP0.55/tonne firmer at GBP105.70/tonne, May Paris wheat was EUR0.75/tonne higher at EUR151.00/tonne, June corn jumped EUR2.50/tonne to EUR159.50/tonne and rapeseed closed EUR4.75/tonne higher at EUR376.25tonne.

For rapeseed this was the highest close for a front month since before Christmas helped by reasonably buoyant US soybean values, and lower anticipated EU production once again in the face of strong demand.

US wheat prices are moving higher - especially so in Chicago - primarily it would seem under the enormity in size of the fund short position that has been built up in it.

Russian spring grain plantings are 12.6% complete so far. That's up sharply compared to this time a year ago. Weather conditions lean favourable for the time being and prospects for 2016 production appear better than feared.

The Russian Ag Ministry estimate winterkill loses at 800k ha, only half of the 1.4 million that was being suggested at the height of the winter. The 2016 Russian wheat crop is now expected to beat last year's total at around 62.3 MMT say Agritel.

In Ukraine, whilst a steep decline in winter wheat is still on the cards, production estimates are nudging higher from some of those being suggested a month or two back.

Europe's crop appears to be in pretty good shape too, and with bumper carryout left over from 2015/16 will be looking for every export avenue open to it.

Keep an eye on North Africa then, where heat/dryness has sapped winter crops and the likes of Morocco, Algeria, Tunisia and Egypt should end up importing good volumes of EU wheat and barley again, say the HGCA.