EU Rapeseed Smashes Through Key Resistance
23/11/16 -- EU grains closed mixed amid a general lack of news. Most noteworthy movement of the day was Paris rapeseed finally smashing through key resistance at EUR400/tonne on front month Feb 17.
At the close Nov 16 London wheat was unchanged at GBP138.75/tonne, Dec 16 Paris wheat was EUR0.50/tonne lower at EUR168.75/tonne, Jan 17 Paris corn was unchanged at EUR166.25/tonne and Feb 17 Paris rapeseed had gained EUR7.75/tonne to EUR406.00/tonne.
It was April 2014 that we last saw Paris rapeseed close this high. "Rapeseed has been boosted by the surge of veg oils after the decision from US Environmental Protection Agency (EPA) to raise the biofuels requirements to 19.28 billion gallons for 2017 vs 18.11 this year. This volume will be spread between 15 billion of conventional biofuel which is mainly produced from corn and 4.28 billion of biodiesel produced from soy oil," noted Agritel.
Malaysian palm oil futures touched 4-year highs and US soybean oil prices surged on the news. US markets are closed tomorrow for Thanksgiving.
Otherwise fresh news was generally lacking. Spain said that they'd imported 1.25 MMT of grains in September, a 19% reduction versus the same month in 2015. Wheat imports were 878.8 TMT versus 967.7 TMT a year previously.
Algeria tendered for 50,000 MT of feed barley for January shipment. Jordan cancelled their tender for 100,000 MT of optional origin hard wheat and immediately re-tendered for the same as is their want. Bangladesh are said to have agreed to buy 200,000 MT of Russian wheat.
Russia said that their 2016 grain harvest had limped to 96.4% complete at 123.5 MMT in bunker weight. Wheat accounts for 75.8 MMT of that total and barley a further 19.1 MMT. Harvesting of both is nearly over. Corn harvesting is ongoing at 78.8% complete for a crop of 13.1 MMT to date.
Winter plantings for the 2017 harvest are just about complete in Russia at 99.8% done.
Rusagrotrans forecast Russia's first half 2016/17 (Jul/Dec) grain exports at 20.5 MMT, down 1 MMT on the same period in 2015/16.
Ex-farm prices in the North East of England are now amongst the highest in the country and above the level of London futures, said the HGCA. Strong demand from the bioethanol sector seems to be the reason, they noted.
"However, the potential for further gains could be more limited as the gap between imported maize and UK wheat prices is now narrowing. The wider price gap between the North East and other regions also increases the incentive to haul wheat into the region," they added.
