EU Grains Mostly Higher, Winter Rapeseed Already In Trouble

25/10/16 -- EU grains closed mixed, but mostly higher. Nov 16 London wheat set a hew highest close for a front month since Dec 2014 helped by a slightly weaker sterling.

At the close Nov 16 London wheat was up GBP1.85/tonne at GBP136.35/tonne, Dec 16 Paris wheat was EUR0.75/tonne firmer at EUR162.75/tonne, Nov 16 Paris corn was up EUR2.50/tonne at EUR161.75/tonne, Nov 16 Paris rapeseed was EUR2.25/tonne easier at EUR391.25/tonne.

The EU Commission's MARS unit lowered their forecast for EU-28 corn yields from 6.84 MT/ha to 6.82 MT/ha (and versus 6.93 MT/ha for the 5-year average).

"This analysis period was marked by contrasting weather conditions. Among the outstanding weather phenomena were the persistent dry conditions, which in France marked the end of a difficult season," they said.

Looking ahead. "these conditions also hampered the sowing of winter cereals in France, western Germany and the Benelux countries due to overly dry seedbeds, and negatively impacted emergence. By contrast, heavy rains in the first half of October are responsible for a marked rain surplus in Poland and southeastern Europe," they added.

For winter rapeseed specifically they highlighted "mediocre sowing and emergence conditions in France and Germany."

"Precipitation was clearly below average from mid-August to mid-September in large parts of France and Germany, the two main EU-28 producers of rapeseed. As a consequence of the dry conditions, part of the rapeseed was not sown at all in France," they noted.

Conditions are more "adequate" in Poland, Europe's third largest producer, in the UK "conditions are rated as being average and rapeseed is quite well established, but there is currently high pest and disease pressure," they added.

Egypt's GASC bought 420,000 MT of wheat, their largest single purchase of the season so far, in their latest tender. They paid an average of $192.62/tonne C&F for 240,000 MT of Romanian wheat and $193.41/tonne for 180,000 MT of Russian wheat.

Despite that, rumblings remain that this year's Russian wheat quality isn't great, with IKAR today reducing their forecast for the nation's wheat exports in 2016/17 by 0.5 MMT to 29.5 MMT (still a record).

Their 2016 wheat harvest is said to be 98.1% complete at 75.8 MMT in bunker weight. Barley harvesting is 97% done at 19.0 MMT and the corn harvest is 52.6% complete at 8.5 MMT.

Russian winter plantings for the 2017 grain harvest are now more than 95% complete on 16.5 million ha.

The 2016 Ukraine grain harvest is said to be 86% complete at 52.27 MMT. That includes 13.28 MMT of corn (54% harvested).