EU Grains End Mostly Lower, Even Weak Pound Can't Save London Wheat Today
The day ended with Nov 16 London down GBP0.65/tonne at GBP128.05/tonne, Dec 16 Paris wheat was down EUR2.25tonne at EUR158.25/tonne, Nov 16 corn was down EUR1.50/tonne at EUR159.50/tonne and Nov 16 rapeseed was up EUR0.25/tonne to EUR377.25/tonne.
Defra released their first UK crop estimates of the year, pegging the UK 2016 wheat harvest at 14.5 MMT, and barley output at 6.7 MMT. That puts wheat production down 12% on last year and below the previous five year average of 14.7 MMT. Barley production will decline 10% year-on-year, but slightly above the 5-year average of 6.5 MMT.
"The gap between UK average ex-farm feed wheat over feed barley has grown to over GBP16/tonne, larger than we saw throughout most of last season. The premium may suggest that feed wheat could be pricing itself out of the feed market, emphasising the good quality wheat crop we have seen this harvest," said the HGCA.
They put final 2016 UK wheat yields at 7.9-8.1 MT/ha, about average for recent years, with specific weights running at 77.2 kg/hl. Winter barley yields have come in at 5.9-6.1 MT/ha, and those for spring barley at 5.6-5.8 MT/ha. Winter OSR yields have only averaged 3.0-3.2 MTha, an 11-17% decrease on the five year average o 3.6 MT/ha. Another nail in the coffin of OSR?
That's not the case in Ukraine apparently, where winter OSR sowings are up 27% to 734.4k ha, according to Ukragrocunsult. You have to bear in mind though that sowings were dramatically reduced due to adverse weather conditions last autumn, so this is more of a return to "normal" plantings. Ukraine's 2016 rapeseed crop was slashed 31% to only 1.1 MMT this year. Rain is in the forecast for the next few days which should advance winter wheat sowings.
The Russian Ag Ministry increased their forecast for this year's Russian wheat crop from 71 MMT to 72 MMT (in clean weight). That's a new post-Soviet era record.
Kazakhstan said that their 2016 harvest had now reached 22.6 MMT off 97.7% of the planned area. That's almost 5 MMT more than at the same date a year ago. Agritel estimate final wheat production to be up 1 MMT at almost 15 MMT this year.
Brussels confirmed the release of 423 TMT worth of EU soft wheat export licences this past week. That brings the season so far total to 6.8 MMT, 17% ahead of this time last year, although the rate of increase is falling almost weekly now.
The USDA currently forecast EU all wheat exports declining 25% in 2016/17.
