EU Grains Mostly Firmer For The Day And The Week

11/03/16 -- EU grains closed mixed but mostly firmer on the day and for the week. The pound closed close to 1.44 against the US dollar, it's best level since Feb 19, and was also up versus the euro putting London wheat under a bit of pressure today.

At the finish, front month Mar 16 London wheat was down GBP0.05/tonne at GBP101.30/tonne, May 16 Paris wheat was EUR0.50/tonne firmer at EUR154.75/tonne, Jun 16 corn was up EUR1.75/tonne to EUR153.50/tonne and May 16 rapeseed was EUR5.00/tonne higher at EUR354.75/tonne.

For the week, London wheat gained GBP1.15/tonne, Paris wheat added EUR2.50/tonne, corn was down EUR2.25/tonne and rapeseed jumped EUR4.75/tonne. The Jul 16/Nov 16 old crop/new crop London wheat spread widened still further to close the week at GBP13.40/tonne versus GBP12.85/tonne a week ago.

Cocereal gave us their first 2016 EU crop production estimates, pegging the soft wheat crop here at 145.2 MMT, a 3.5% decline on a year ago.

The EU-28 all barley crop was estimated down 3.6% at 58.9 MMT, and corn production will rise 8% to 63.2 MMT, they predict.

On a UK level, we will harvest 15.0 MMT of wheat this year, some 6.9% less than a year ago, and 2% less barley (7.1 MMT). The UK OSR crop was pegged more than 15% lower at 2.15 MMT incidentally, although the EU-28 crop overall is seen little altered at 21.6 MMT.

Brussels announced 691 TMT worth of EU soft wheat export licences this week - the same volume as last week. However, they also said that Lithuania had previously mis-reported the sale of 300 TMT of wheat as durum, not soft wheat, which means that the cumulative totals to date need a tweak.

The corrected figure for soft wheat is now 19.4 MMT, a 15% fall compared with a year ago.

Barley licences were awarded for 185 TMT, taking the seasonal total to date to 7.46 MMT, a 15% rise versus this time last year.

FranceAgriMer reported French winter wheat crop conditions down a point on a week ago to 93% good to excellent (but still 2 points ahead of this time last year). Winter barley fell 2 points to 91% good/very good (the same as a year ago).

French winter wheat displaying an ear of at least 1cm is 33% versus 21% last week and only 5% this time last year. Winter barley at that stage is 28% (18% a week ago and 3% a year ago). French spring barley plantings are said to be 32% complete versus 14% the previous week and 40% a year ago.

Ukraine said that they'd exported 27.7 MMT of grains so far this season, including 12 MMT of wheat and 11.5 MMT of corn plus a further 4 MMT of barley.

The Ukraine Ag Ministry said that winter-kill issues hadn't been as bad as was first thought, estimating the total grain area lost at 7% - it was double that in January. Still, what has at least partially recovered will still likely only be rated as being in "poor" condition - around a third of all winter sown grains.

The weather forecasts for the fortnight ahead trend drier than normal for the UK and most of western, central and northern Europe. It's wetter than normal in the south - Spain, Italy and into the east. That should enable some good progress to be made with fieldwork in the former areas at least.

It's forecast to be cooler than normal in France and Spain in the week ahead, then normal to warmer than normal the week after that across almost the whole of Europe.

Chicago Grains End Higher- Beans Post Seventh Day Of Gains

10/03/16 -- Soycomplex: Beans closed higher for a seventh session in a row. Weekly export sales of 475,200 MT for 2015/16 were up 8 percent from the previous week and 2 percent from the prior 4-week average, although exports of 1,134,700 MT were down 8 percent from the previous week and 20 percent from the prior 4-week average. For once China wasn't the largest weekly taker on the sales, that honour went to the Netherlands this week. The Brazilian Real hit fresh 6 month highs against the US dollar today, which was friendly. Increased South American production estimates aren't though. The The Rosario Grain Exchange pegged Argentina's crop at 59 MMT versus 58.5 MMT from the USDA. CONAB went for 101.2 MMT fro Brazil as opposed to 100 MMT from Washington. Mar 16 Soybeans settled at $8.81 3/4, up 1 3/4 cents; May 16 Soybeans settled at $8.89 1/4, up 3 1/2 cents; Mar 16 Soybean Meal settled at $270.20, up $0.60; Mar 16 Soybean Oil settled at 31.41, down 11 points.

Corn: The corn market closed higher, helped by decent weekly export sales which at 1,172,300 MT for 2015/16 were up 7 percent from the previous week and 37 percent from the prior 4-week average. Exports themselves were also encouraging at 1,052,500 MT - a marketing-year high - these were up 33 percent from the previous week and 48 percent from the prior 4-week average. Maybe Brazil's corn exports are slowing up as the bean harvest there progresses and the strong real hits foreign sales? The Rosario Grain Exchanged increased their Argentine production estimate to 24.5 MMT from 24.2 MMT, although that's still well below the USDA's 27.0 MMT. CONAB upped their Brazilian production estimate to 83.5 MMT from 83.3 MMT. Again though that's below the USDA who are at 84.0 MMT. China are expected unveil a new corn pricing policy later this month, with some suggesting that they might lower corn reserve prices below import parity. Mar 16 Corn settled at $3.62 1/2, up 3 1/2 cents; May 16 Corn settled at $3.62 3/4, up 3 1/4 cents.

Wheat: The wheat market closed with decent gains. Weekly export sales of 330,600 MT for delivery in marketing year 2015/16 were down 4 percent from the previous week, but up 6 percent from the prior 4-week average. That's still no great shakes though. New crop sales of 102,900 MT were also reported. Season to date total old crop sales are down 17.5% from this time last year with 13 weeks remaining in the marketing year. I don't see them catching up. Weekly US wheat exports of 417,500 MT were up 8 percent from the previous week and 25 percent from the prior 4-week average. The primary destinations were the Philippines (78,500 MT), Japan (68,000 MT), Taiwan (50,400 MT), Mexico (35,400 MT), Guatemala (35,400 MT) and South Korea (34,200 MT). The euro had a volatile day against the US dollar following the news that the ECB were to cut interest rates and raise QE again. US weather on the Plains will keep market shorts interested and jittery over the coming weeks. May 16 CBOT Wheat settled at $4.77, up 8 3/4 cents; May 16 KCBT Wheat settled at $4.83 1/4, up 7 1/2 cents; May 16 MGEX Wheat settled at $5.12 1/2, up 7 1/2 cents.

EU Grains Mixed, Euro Choppy After Surprise Rate Cut

10/03/16 -- EU grains closed mixed. The market on the continent garnered some support from news that the ECB had cut interest rates again and was raising quantitative from EUR60bn to EUR80bn a month. That support however had disappeared by the close.

At the finish, front month Mar 16 London wheat was up GBP0.15/tonne at GBP101.35/tonne, May 16 Paris wheat fell EUR0.50/tonne to EUR154.25/tonne, Jun 16 Paris corn was down EUR1.25/tonne to EUR151.75/tonne and May 16 Paris rapeseed fell EUR1.25/tonne to EUR349.75/tonne.

The ECB news initially saw the euro fall, with the pound rising above 1.30 against the single currency and with the former dropping close to 1.08 versus the US dollar. That weakness however proved to be short-lived, with trading values late in the day back up above last night's closing values - and significantly so.

Early Russian spring grain planting is well ahead of year ago levels, aided by unusually warm weather. The Russian Ag Ministry said that planting works had been completed on almost 440k ha versus only 116.5k ha this time a year ago.

Ukraine's early spring plantings are also well advanced for the time of year at 146k ha (6% done).

Tunisia tendered for 67,000 MT of milling wheat and 25,000 MT of feed barley for June/July shipment. France would normally be expected to put in a bold showing to win that business. Iraq are said to have cancelled a tender for hard wheat.

Exports from France’s largest grain port of Rouen fell 10% in the week of March 9th to 283 TMT, including 61.5 TMT of soft wheat to Algeria and 55 TMT to Morocco.

Winter wheat and barley crop conditions in France are looking good at 94% and 91% good to very good respectively as of last Monday. As we enter the final quarter of 2015/16 stocks of both are the highest in years.

"In the short-term, there are no fundamental reasons for price levels to change. Stocks in the EU and worldwide are ample and the moderate effect of El NiƱo on markets is already incorporated in price expectations. Unless new weather events change the crop development progress, there is no reason for higher cereal prices," the EU Commission said earlier this week.

"Early forecasts for the 2016/2017 harvest are showing a good level of cereal production at around 310 million tonnes in the EU, slightly above the 2015/16 harvest," they added. That will be aided by a sharp rebound in corn output more than compensating for a 5% decline in soft wheat production.

Carryover stocks at the end of 2015/16 will also be unusually high too, of course.

Chicago Grains Comment: USDA Report Provides Little Direction

09/03/15 -- Soycomplex: Beans closed around a cent or two higher on the day. The USDA appeared reluctant to make too many changes to it's WASDE report, cutting the US crush by 10 million bushels, and therefore raising ending stocks a similar amount. Brazilian and Argentine production was left unchanged. Brazilian exports were raised 1 MMT. World ending stocks fell 1.55 MMT. China's imports were increased from 80.5 MMT to 82 MMT. IMEA said that Brazil's Mato Grosso state growers are already 66% sold on new crop beans, up 6 points on this time last year (and they were well advanced with sales then too). Brazil said that they'd exported over 2 MMT of beans in Feb, up nearly 400 TMT versus Jan and more than double the volume shipped out in Feb 2015. Mar 16 Soybeans settled at $8.80, up 2 1/2 cents; May 16 Soybeans settled at $8.85 3/4, up 1 1/4 cents; Ma 16 Soybean Meal settled at $269.60, down $1.20; Mar 16 Soybean Oil settled at 31.52, up 60 points.

Corn: The corn market closed with little change following a USDA report that did little to provide any meaningful new direction. The US corn balance sheet was totally unaltered, as too was South American production. There were higher Brazilian exports last season, which resulted in reduced ending stocks getting carried into 2015/16 and hence a cut in carryout this year. South African corn production was reduced by 0.5 MMT to 6.5 MMT and imports were boosted a similar amount to 3.5 MMT. Nothing too startling in any of that lot. The US Energy Dept reported weekly US ethanol production at 987,000 barrels/day, down 9,000 bpd from a week ago. Brazil's IMEA said that farmers that had forward sold 60% of this year's new crop corn, some 18 points ahead of where they were this time last year. The market will now turn it's attention to US planting progress and the weather ahead of the Mar 31 planting intentions report. Some early planting is underway in Texas. Mar 16 Corn settled at $3.59, up 1/4 cent; May 16 Corn settled at $3.59 1/2, down 1 cent.

Wheat: The wheat market closed slightly firmer. The USDA left US all wheat ending stocks unchanged at 966 million bushels versus trade expectations of a small increase to around 975 million. World ending stocks were cut by 1.27 MMT. World production is still 7 MMT above last year and carryout is still 23 MMT over last year though, so there's no shortage of wheat just yet. Jordan bought 100,000 MT of hard wheat of optional origin for Aug/Sep shipment. It was said that a fair proportion of the recent Saudi wheat purchase was possibly of German origin. Pakistan's Ag Min said that they might harvest a record 26 MMT of wheat this year. versus 25.5 MMT in 2015. Media reports conflict surrounding Egypt's wheat imports. Some say that they've settled on a new ergot maximum inclusion level of 0.55% and some say that they have stated that they will continue to attempt to press home with their zero tolerance stance. We can expect a tender in the next week or so to maybe clarify the matter. May 16 CBOT Wheat settled at $4.68 1/4, up 3 cents; May 16 KCBT Wheat settled at $4.75 3/4, up 4 3/4 cents; May 16 MGEX Wheat settled at $5.05, up 1 1/4 cents.

EU Grains Mixed - USDA Report Said To Be Not As Bearish As Expected

09/03/16 -- EU grains closed mixed, with London wheat a touch lower and Paris wheat slightly firmer.

At the close of trading, Mar 16 London wheat was down GBP0.30/tonne at GBP101.30/tonne. In Paris, Mar 16 wheat closed EUR0.25/tonne higher at EUR144.50/tonne, Jun 16 corn was up EUR0.75/tonne at EUR153.00/tonne and May 16 rapeseed was down EUR0.25/tonne to EUR351.00/tonne.

Most of the day was spent waiting for the March WASDE report from the USDA, not that it was expected to be a big market mover - and so it proved - with traders saying it was "less bearish than expected" according to

Prior to that it was announced that France had exported 1.1 MMT of soft wheat to non-EU destinations in January. That was a "ho-hum" sort of a volume, being down from 1.3 MMT in December, although still the second highest monthly total of the season so far.

Total Jul/Jan non-EU exports are now 8.1% higher than they were a year ago at 5.7 MMT.

The top home in January this year was Morocco taking 518 TMT, followed by Algeria with 329 TMT.

Jordan were said to have bought 100 TMT of optional origin hard wheat for Aug/Sep shipment.

The USDA report wasn't expected to throw up any big changes - especially so for wheat - and that's pretty much what we got. They won't start giving us any 2016/17 forecasts until May.

World 2015/16 production was tweaked lower, down from last month's 735.8 MMT to 732.3 MMT, although consumption was also dropped around 2 MMT to 709.4 MMT.

On an EU level, there were no changes to 2015/16 wheat exports of consumption. Production was however nudged higher, up from the 158 MMT estimated last month to 158.5 MMT. That helps take ending stocks this season up the best part of 1 MMT to 20.2 MMT - the most since 2005/06.

Russia's export potential this season was trimmed from 23.5 MMT to 23.0 MMT. This was due to "due to the recent slow trade to major markets," they said.

Chicago Grains Post Small Gains Ahead Of USDA Report

08/03/16 -- Soycomplex: Beans closed higher for a fifth day, which I guess sets the tone for lower consolidation type trade in the morning ahead of tomorrow's USDA WASDE report. The trade is expecting Brazilian production at an average 100.13 MMT in that (versus 100 MMT last month) and with Argentina at 58.85 MMT (Feb: 58.5 MMT). US 2015/16 ending stocks are seen little changed at 452 million bu, versus the Feb estimate of 450 million. Today the USDA said that private exporters had sold 110,000 MT of US soybeans to China for 2016/17 delivery, and an additional 140,000 MT to unknown destinations (split 70,000 MT for 2015/16 delivery, and 70,000 MT for 2016/17 delivery). China said that it had imported 4.51 MMT of beans in February versus 4.26 MMT a year ago and 5.66 MMT in January. Feb imports would usually decline due to the Lunar New Year. Mar 16 Soybeans settled at $8.77 1/2, up 4 cents; May 16 Soybeans settled at $8.84 1/2, up 2 3/4 cents; Mar 16 Soybean Meal settled at $270.80, up $2.30; Mar 16 Soybean Oil settled at 30.92, down 3 points.

Corn: The corn market closed higher, with the Dec contract also posting a fifth successive day of increase. Tomorrow's USDA report is expected to peg Brazilian production at an average 84.5 MMT, up 0.5 MMT versus their February estimate. Argentina is expected to come in at 27.23 MMT (Feb: 27.0 MMT). US 2015/15 corn ending stocks are seen at an average of 1,854 million bushels, up 17 million from a month ago. US exports are noticably lagging the pace required to meet USDA expectations for 2015/16, but they might not adjust these or ending stocks too drastically until next month, some are saying. Once we get tomorrow's USDA report out of the way, the trade will be looking to the Planting Intentions estimates due at the end of the month and then starting to concentrate on long-term US weather forecasts for the spring/summer. The EU-28 2016 corn crop will rebound to 67.3 MMT, up 16% compared to 58 MMT in 2015, said the EU Commission in it's first look into the season ahead. Mar 16 Corn settled at $3.58 3/4, up 3 3/4 cents; May 16 Corn settled at $3.60 1/2, up 1 1/2 cents.

Wheat: The wheat market closed a touch higher heading into tomorrow's report. In that US all wheat ending stocks for 2015/16 are seen riding 9 million bushels to 975 million bu. The EU Commission forecast 2016/17 soft wheat production there down 5.5% this year at 143.6 MMT. However, they see exports also dipping, and the large carry-in left over from this season propelling ending stocks up to an eight-year high of 17.4 MMT. "The warmer than normal winter means that so far there is only limited frost kill in western Poland, eastern Bulgaria and Romania and the Baltic countries. However, the warm weather also led to delayed cereal hardening in most parts of Europe. This indicates that winter crops still remain vulnerable to potential frost damage," they noted, in line with other commentators. Kansas winter wheat was rated 56% Good to Excellent; Texas 42% G/E; Oklahoma 66% G/E. May 16 CBOT Wheat settled at $4.65 1/4, up 2 1/2 cents; May 16 KCBT Wheat settled at $4.71, up 1/4 cent; May 16 MGEX Wheat settled at $5.03 3/4, up 3 cents.

EU Grains Mixed On Light News Day

08/03/16 -- EU grains closed mixed. News was thin ahead of tomorrow's WASDE report from the USDA and with Russia closed.

At the finish, front month Mar 16 London wheat was down GBP0.05/tonne at GBP101.50/tonne, Mar 16 Paris wheat was EUR1.25/tonne firmer at EUR144.25/tonne, Jun 16 corn fell EUR1.00/tonne to EUR152.25/tonne and May 16 rapeseed was EUR2.50/tonne lower at EUR351.25/tonne.

Russia remained closed for a holiday for a second day, limiting fresh news from that direction. Crude oil traded lower after hitting 3-month highs yesterday, the sentiment from which seemed to spill over into other markets.

The international tender front is a bit quiet so far this week. Syria are in the market for 200,000 MT of wheat and Algeria are said to be shopping for feed barley.

In their first look into crop production prospects for 2016, early forecasts "are showing a good level of cereal production," the EU commission said.

They forecast a 2016 EU soft wheat crop of 143.6 MMT, a 5.5% decline on a year ago.

That's only half of the story though "Europe’s inventories of unsold soft wheat are predicted to reach an eight-year high at the end of June 2017 as exports of the grain slide for a second season," noted Bloomberg.

They were referring to the Commission's estimate for a 200,000 MT rise in EU soft wheat ending stocks to 17.4 MMT come the end of 2016/17.

EU 2016/17 soft wheat exports are estimated at 27 MMT versus 29.1 MMT this season and 33.3 MMT in 2014/15.

EU barley production later this year is estimated at 61.5 MMT, up marginally on 61.3 MMT last year. Rapeseed output in 2016 was forecast at 21.3 MMT, also little altered on 21.4 MMT a year ago. The EU 2016 corn crop will rebound to 67.3 MMT, up 16% compared to 58 MMT in 2015.

"Unless new weather events change the crop development progress, there is no reason for higher cereal prices. This development raises the question on whether this is the new average price level to be expected, although it is too early to assess it," the Commission pondered.

The USDA's March WASDE report is due tomorrow. They won't give us their first estimates on global crop production and demand for the year ahead until May.

Chicago Markets End Firmer, Helped By Improved Exports

07/03/16 -- Soycomplex: Beans closed with small gains helped by positive weekly export data. The USDA reported weekly soybean export inspections of 1.067 MM, up 70.5% from the same week a year ago. YTD inspections are now only 7% behind last year's record pace. The USDA currently predicts these falling more than 8% for the 2015/16 season. Talk of a possible Brazilian trucker strike next week leans a bit friendly too. Even if fund money has cut the size of it's short position, they were still net short nearly 70k lots as of last Tuesday night. A suddenly firmer Brazilian real also lends a bit of support to beans following the news that the Brazilian authorities had detained former president Luiz Inacio Lula da Silva on links to corruption. Mar 16 Soybeans settled at $8.70 1/2, up 14 1/2 cents; May 16 Soybeans settled at $8.78 1/2, up 14 3/4 cents; May 16 Soybean Meal settled at $270.90, up $0.60; May 16 Soybean Oil settled at 30.96, up 35 points.

Corn: The corn market closed a bit firmer, helped by outside markets like crude hitting its best levels of 2016 so far. Weekly export inspections were in line with trade estimates at 953,062 MT and showed a 29% improvement on last week. YTD inspections are still down 20.5% on last year though. The USDA sees them declining only 10.2% for the full season. Friday's Commitment of Traders report shows fund money sitting on a net short position in Chicago corn of over 206k contracts, keeping them a bit jittery. Ukraine seaports were reported to have exported over 580,000 MT of corn last week, and Russia chipped in with a further 110,00 MT. New crop corn planting is now underway for the US 2016 harvest! Corn planting was 5% complete in Texas as of Sunday night. The firmer Brazilian real may start to knock there corn exports, which have been running at record levels of late, US offers are said to be competitive with those out of Brazil and Argentina right now. Mar 16 Corn settled at $3.55, up 1/2 cent; May 16 Corn settled at $3.59, up 3/4 cent.

Wheat: The wheat market closed with small gains, but off earlier highs. Weekly export inspections of 443,190 MT were a bit better than of late, being up 18% on a week ago. YTD inspections are still 12.3% behind last year though versus a USDA forecast for a full season decline of only 5.5%. Given that the US 2015/16 season finishes at the end of May there isn't a great deal of time left to make up that lost ground. Still, a weaker tone to the dollar this week might help. Dryness concerns on the Southern and western Plains keep getting a mention. With fund money short of 113k lots of SRW wheat as of last Tuesday they might be more concerned about this than you or I. That's the equivalent of over 15 MMT. Again, when fund money is sitting on a short like that, short-covering can be triggered for little apparent reason. US weather will start to play an important role now. EU wheat thus far looks to have escaped with a mild winter. Russian prospects are being upgraded, and winter-kill fears down-sized. May 16 CBOT Wheat settled at $4.62 3/4, up 2 cents; May 16 KCBT Wheat settled at $4.70 3/4, up 2 cents; May 16 MGEX Wheat settled at $5.00 3/4, up 3 cents.

EU Grains Recovery Continues

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.

Chicago Grains End Higher On Short-Covering/Consolidation

04/03/15 -- Soycomplex: Beans closed higher on the day and for the week. Rain delays to the Brazilian harvest, and a sudden revival in value to the real are boosting US beans, prompting some short-covering. Argentina is recieving near record amounts of rain in some areas too, said the Buenos Aires Grain Exchange. They left their production forecast at 58 MMT however. A weaker US dollar and strong crude oil prices were also supportive factors for the entire grains complex today. Mar 16 Soybeans settled at $8.70 1/2, up 14 1/2 cents; May 16 Soybeans settled at $8.78 1/2, up 14 3/4 cents; Mar 16 Soybean Meal settled at $267.70, up $5.70; Mar 16 Soybean Oil settled at 30.73, up 32 points. For the week that puts front month beans 7 cents higher, with meal up $10.50 and oil down 30 points.

Corn: The corn market closed a cent or two higher on the day but flat to a cent or two lower for the week. Fresh news was light. There was perhaps a bit of light consolidation heading into the weekend. "Domestic corn prices in Brazil continue to be supported by very strong corn exports," said Dr Cordonnier. "The strong domestic prices are the result of a tight supply resulting from record large corn exports and declining full-season corn production," he said. However, now these exports will now start to drop off in favour of beans, he added. High prices though mean that the country's safrinha corn area may increase by as much as 10% compared to last year, he notes. The Argentine corn harvest is 2% complete. The Buenos Aires Grain Exchange estimate production at 25 MMT this year. Mar 16 Corn settled at $3.54 1/2, up 3/4 cent; May 16 Corn settled at $3.58 1/4, up 1 3/4 cent. For the week Mar 16 was unchanged and May 16 was down 1 1/4 cents.

Wheat: The wheat market closed higher on the day and for the week. Short-covering has been the theme. "Dryness that has started to persist across patches of the US Plains has caught the attention of wheat markets this week," noted the HGCA. That's where the big fund short is, so that's what the market is paying attention to. French wheat prices were lower on the day and for the week though, so as US wheat was already struggling to compete internationally, then it won't do much good for US wheat prices to rise a lot further out of sync. Russia expects to export a record wheat volume in 2015/16. Prospects look pretty good for 2016/17 too, with SovEcon calling for a grain crop of 100-105 MMT, of which wheat will consist 59-62 MMT - both broadly similar to last year. May 16 CBOT Wheat settled at $4.60 3/4, up 1 cent; May 16 KCBT Wheat settled at $4.68 3/4, up 2 3/4 cents; May 16 MGEX Wheat settled at $4.97 3/4, down 1/4 cent. For the week, Chicago wheat was up 8 1/4 cents, Kansas added 14 1/2 cents and Minneapolis gained 7 3/4 cents.

EU Grains Report - Friday

04/03/16 -- EU grains closed mixed, with London wheat just about managing a rare second day in succession higher close - even if only narrowly. Session highs were set much earlier in the day though.

At the close of trading, Mar 16 London wheat was up GBP0.15/tonne at GBP100.15/tonne. In Paris, Mar 16 wheat closed a choppy session EUR3.50/tonne lower at EUR140.75/tonne, Mar 16 corn was down EUR1.25/tonne at EUR145.75/tonne and May 16 rapeseed rose EUR3.25/tonne to EUR350.00/tonne.

For the week, London wheat was still GBP1.35/tonne lower, whilst Paris wheat lost EUR4.50/tonne, corn was down half a euro and rapeseed was unchanged.

The gap between May 16 and Nov 16 London wheat ends the week at a cavernous GBP12.85/tonne, up from GBP12.40/tonne a week ago.

Brussels confirmed the release of 689 TMT of soft wheat and 340 TMT worth of barley export licences. That takes the respective cumulative totals for the season to 18.4 MMT (down 14% year-on-year) and 7.3 MMT (up 13%). Corn imports of 236 TMT, for a seasonal total of 9.7 MMT, were also approved.

FranceAgriMer said that weekly soft wheat crop conditions there were 94% good to very good, unchanged on a week ago and 3 points ahead of 2015. Winter barley conditions fell one point from last week to 91% good to very good (90% on 2015).

The mild weather had crop development ahead of 12 months ago, with 21% of the French winter wheat crop already having an ear of at least 1cm versus 10% a week ago and only 1% this time last year. Winter barley is 18% versus 9% last week and 0% last year.

French spring barley is 14% sown (34% last year) and 6% emerged (the same as a year ago).

A Bloomberg report said that drought "has probably wiped" more than half of Morocco's 2016 intended winter wheat harvest. An analyst survey conducted by them placed the Moroccan 2016 wheat harvest at an average of only 3.72 MMT, down 54% on last year. That could double their import requirements, for which France are traditionally a major supplier, in 2016/16.

Russia's IKAR forecast the nation's 2015/16 grain exports at a record 34 MMT, just slightly behind the 34.5 MMT estimated by Rusagrotrans earlier on the week. Of that wheat will consist 71.5%, or a record 28.3 MMT, they predict.

ProZerno said that Russia will harvest 100-100.5 MMT of grains this year, a bit below the 104.3 MMT that they produced in 2015. Around 9% of winter crops have perished, somewhat better than the 12% that they were predicting a few months ago, and about average. Corn production in 2016 will amount to a record 13 MMT, they said.

Ukraine said that early spring grains, mostly barley, were about 4% planted for the 2016 harvest.