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01 May 2016 | Online since 2003
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EU Reports

29 April 2016 | EU Reports
28/04/16 -- EU grains traded mostly firmer to start the week, with May 16 London wheat unchanged at GBP106.60/tonne, May Paris wheat was EUR1.75/tonne higher at EUR153.00/tonne, June corn was up EUR2.25/tonne to EUR165.00/tonne and May 16 rapeseed closed EUR1.75/tonne weaker at EUR367.25tonne.

Brussels issued export certificates for 599 000 MT of wheat during last week. Barely licences were a pleasing 174 000 MT.

Russia's Ag Min said that they'd exported 22 MMT of wheat so far this season (out of a 62 MMT harvest), and increased it's forecast for full season exports estimate to a record 24-25 MMT.

Saudi Arabia has announced a tended or 550,000 MT of 12.5% hard wheat for Jul/Aug delivery with the results expected over the weekend.

Activity is light ahead of Monday's Bank Holiday, with some trader's already away from their desks.



28 April 2016 | EU Reports
27/04/16 -- EU grains mixed, with front month May 16 London wheat unchanged at GBP104.65/tonne, May 16 Paris wheat was EUR0.25/tonne lower at EUR151.25/tonne, June corn rose EUR2.00/tonne to EUR162.25/tonne and May 16 rapeseed closed EUR3.00/tonne lower at EUR369.00/tonne.

May 16 rapeseed goes off the board on Friday, so could display some choppy trade ahead of that. Despite expiry being only a few days away, open interest in May 16 is still the largest of all the Paris rapeseed contracts.

Early spring grin plantings in Ukraine are just about done at 99% complete, according to the AG Ministry there. Spring barley sowing is complete on 98% of the government forecast at 1.78 million ha.

Oilseeds and corn are excluded from early spring grain figures. In Ukraine corn plantings are estimated 49% complete so far 92.24 million ha), with sunseed 55% planted (2.859 million ha) and soybeans 25% (502 million ha) sown.

In March Ukraine exported 2.427 MMT of corn, which is 32% greater than the volume of exports in March 2015 (1.836 MMT), according to UkrAgroConsult.

Ukraine exported a record 2.7 MMT of grains in April, And said that they'd exported 33.3 MMT of grains so far this season, including 15 MMT of corn, 15 MMT of wheat and 4.1 MMT of barley. The barley campaign is just about over for 2015/16.

Concerns still linger over Ukraine's production prospects for this year though. "Dry conditions during the sowing period and frost kill in January, drastically impacted winter crops in both Ukraine (and Poland). Despite favourable conditions since the beginning of March it looks like winter crops have had very little regrowth," the HGCA reported MARS as saying yesterday.

That doesn't seem to be the case in Russia though, where ProZerno estimate 2016 grain production 0.6% higher than last year at 105.46 MMT. Wheat could account for almost 61 MMT of that, they say.

Morocco announced that it will maintain its import taxes on wheat of up to 30% until the end of the year. The move comes despite a poor harvest leading to an anticipate jump in import needs in 2016/17.



27 April 2016 | EU Reports
26/04/16 -- EU grains closed mixed. with front month May 16 London wheat was down GBP0.60/tonne at GBP104.65/tonne, May 16 Paris wheat was EUR0.75/tonne lower at EUR151.75/tonne, Jun 16 corn was up EUR1.15/tonne to EUR161.75/tonne and May 16 rapeseed tumbled EUR2.75/tonne at EUR372.00/tonne.

According MARS, the European crop monitoring service, winter crop conditions in Europe are improving. They rated winter wheat yield potential in 2016 at 6.11 MT/ha versus 5.96 MT/ha seen last month. For winter barley, yields have been upgraded to 5.97 MT/ha vs 5.82 MT/ha and for rapeseed to 3.35 MT/ha vs 3.31 Mt/ha.

Potential corn yields were lowered from 7.12 MT/ha to 7.06 MT/ha however.

"Crop growth conditions have been good in most regions of Europe," Mars said.

"In most regions, weather conditions have been favourable for winter crop growth and spring sowings," Mars said.

"In general, the current prospects for EU-28 yields are above the five-year average, and the forecast for total cereals has increased compared to our last bulletin, reflecting the generally good growth conditions".

France is said to be "benefiting from good conditions," with above-trend yields expected. Note that French growers have planted an 80-year high winter wheat area, and current crop conditions are ahead of a year ago when a record crop was brought in.



26 April 2016 | EU Reports
25/04/16 -- EU grains traded mostly firmer to start the week, with May 16 London wheat bucking the trend, closing GBP0.25/tonne lower at GBP105.25/tonne, May Paris wheat was EUR1.75/tonne higher at EUR152.25/tonne, June corn was up EUR0.50/tonne to EUR15850/tonne and rapeseed closed EUR0.5/tonne higher at EUR374.75tonne.

The latter goes off the board on Friday when new crop Aug 16 will become the new front month.

The USDA's office in Moscow said that Russia may harvest 101 MMT of grains this year, including 58 MMT of wheat, 18 MMT of barkey and 12.5 MMT of corn.

All would be a little below the levels produced in 2015. Exports might fall 1.4 MMT to 30.2 MMT in 2016/17, it is predicted, but still at historically high levels.

They peg wheat exports at 22 MMT (-1 MMT%), with those for barley at 4.0 MMT (-0.2 MMT) and corn at 3.5 MMT (-0.3 MMT).

Russian seaports only exported 250 TMT of grains last week, down sharply from 456 TMT the previous week. Wheat shipments totalled 176 TMT, corn exports 46 TMT and those for barley were 25 TMT.

Ukraine's exports via seaports also dropped, down from 662 TMT to 414 TMT, including 243 TMT of wheat, 160 TMT of corn and 117 TMT of barley.



22 April 2016 | EU Reports
21/04/16 -- EU grains mixed, with front month May 16 London wheat up GBP1.10/tonne at GBP107.50/tonne, May 16 Paris wheat was EUR1.50/tonne lower at EUR153.25/tonne, June corn fell EUR0.75/tonne to EUR163.00/tonne and rapeseed closed a euro higher at EUR380.25/tonne.

Brussels confirmed 712 000 MT of soft wheat and 137 000 MT of barley export licences this past week. Wheat exports thus were up 34% on a week ago.

Wheat crops across most of Europe are developing well, and another bumper production year is expected, if not quit matching last year's dizzy heights.

"Poland is the main problem area but otherwise the picture is broadly looking good," a German analyst told Reuters.

The French have planted an 80-year high record crop, and conditions there were rated almost universally good to very good as of last Monday (92%) say FranceAgriMer. A Bloomberg survey this week put the French soft wheat crop at an average of 39.4 MMT this year, down 3.9% on a year ago.

With such a high proportion of the crop rated good to very good though it may be that yields outperform and production is closer to, or even exceeds, last year. The highest estimate in the survey was 41.9 MMT.

A similar survey at this point last year only pegged average production at around 38.0.38.5 MMT as I recall, based on good to excellent ratings around the 91% mark.

Germany's 2016 winter wheat crop will probably fall around 1.7 percent from last year's bumper harvest to 26.10 MMT. That's still above the recent 5-year average of about 25 million, Germany's farm cooperatives association estimates.

The Polish winter wheat crop could be 4% down last year, say Sparks Polska. "Most of the lost winter wheat acreage will be replanted with spring wheat. Recent warm and rainy weather was more crop-friendly," they told Reuters.



21 April 2016 | EU Reports
20/04/16 -- EU grains closed mostly firmer, drawing good support from surging US prices in Chicago.

At the finish, front month May 16 London wheat was up GBP1.70/tonne at GBP107.40/tonne, May 16 Paris wheat was EUR4.75/tonne higher at EUR155.75/tonne, Jun 16 corn was up EUR4.75/tonne to EUR163.75/tonne and May 16 rapeseed jumped EUR3.00/tonne at EUR379.25tonne.

This was the highest close on a front month in London wheat since late January, the best of the calendar year so far on corn and the highest since early December on rapeseed.

Russian shipping data shows that their wheat exports fell last month to 1.78 MMT, down 215% versus the shorter month previously. Egypt was the largest home taking 28% of all exports, with Turkey (11%) in second and Iran (8.7%) in third.

Russia's corn exports remain relatively strong by comparison, down only 2.8% versus February, and up 53% year-on-year, at 669,400 TMT. Turkey was the top buyer last month with 21.6% followed by the Netherlands with 20.7% then South Korea with 19.4%.

UkrAgroConsult expects 2016/17 Ukraine wheat production to reach 19.8 MMT, up from its previous estimate of 18.5 MMT. That's falling into line with other analysts's ideas that the worst is now over for Ukraine wheat.

There's some talk of current low prices cutting EU corn plantings from current forecast levels.

Plantings are certainly slow in with France, only 4% done versus 17% complete a year ago in last week's report from FranceAgriMer.



20 April 2016 | EU Reports
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



19 April 2016 | EU Reports
18/04/16 -- EU grains mixed, but mostly steadier to start the new week.

At the finish, front month May 16 London wheat was up GBP1.10/tonne at GBP105.15/tonne, May 16 Paris wheat was EUR0.25/tonne lower at EUR151.00/tonne, June corn rose EUR0.25/tonne to EUR155.75/tonne and rapeseed closed EUR3.50/tonne higher at EUR372.00/tonne.

A Bloomberg survey forecast this year's coming EU28 soft what crop at 145.8 MMT, from within a range of 140.77-153.00 MMT, and all wheat output at 154.9 MMT, from within a range of 15.68-161.70 MMT (USDA all wheat 160.00 MMT in 2015/16). In the case of all wheat that's a 3.2% fall versus last year.

As far as a nation-by-nation breakdown goes, the average guess for French soft wheat was 39.4 MMT, with Germany at 26.0 MMT and the UK at 15.3 MMT.

There's a long way to go just yet, but for now those figures look about right, although under pressure I'd tend to favour higher numbers than lower ones right at this moment in time.

There's much debate too over crop production potential in Ukraine and Russia. Agrtel today released their latest forecasts, calling for Ukraine wheat in 2016 at 19.3 MMT, up from 17.2-18.1 MMT previously, although down 27% on a year ago.

For Russia they are now predicting a wheat crop of 62.3 MMT, up from 61 MMT in 2015 from the USDA.

Russian seaports shipped out 456 TMT of grains last week, including 330 TMT of wheat, 52 TMT of corn and 69 TMT of barley. Calendar year to date exports are 9.58 MMT, of which wheat accounts for 5,38 MMT. Full 2015/6 season to date exports are 32.5 MMT, of which wheat accounts for 21.44 MMT.

Ukraine's seaports meanwhile shipped out 662 TMT of grain last week, including 235 TMT of wheat 425 TMT of corn and 3 TMT of barley.

The picture being painted then continues to be one of another strong production year in 2016/17, output mighty be down,, but not by much. Large carryover stocks from 2015/16 still means that we will begin the new season with a larger disposable surplus than the last.



18 April 2016 | EU Reports
15/04/16 -- EU grains closed mostly lower, with one or two minor exceptions, and narrowly mixed for the week. The latter theme highlighting the lack of direction in the market right now.

At the finish, front month May 16 London wheat was down GBP0.05/tonne at GBP104.10/tonne, May 16 Paris wheat was EUR2.50/tonne easier at EUR151.25/tonne, Jun 16 corn was up EUR0.50/tonne to EUR156.75/tonne and May 16 rapeseed fell EUR3.25/tonne at EUR368.50/tonne.

For the week, that puts London wheat GBP2.10/tonne weaker, with Paris wheat shedding EUR3.00/tonne, corn gaining EUR1.75/tonne and rapeseed adding a quarter of a euro.

European wheat exports have maybe fared a bit better than expected this season, although carryover volumes from 2014/15 are still high. The outlook for bumper production again in 2016/17 will likely cap gains for the time being.

Thee re are legitimate concerns over the size of this year's Ukraine wheat crop due to late planting and adverts winter weather. APK Inform agency peg winter wheat sowings in Ukraine down 14%, with production of around 21.5% - down 37 compared to 2015's crop. Some of this decrease will be compensated for by increased planting and production of corn in Ukraine this year.

The jury is still out on Russia, but losses are not thought likely to be so extreme.

In France, winter wheat crop condition ratings were left unchanged on a week ago at 92% good to very good with 99% of the crop now displaying an ear of at least 1cm. Winter barley is 91% good to very good and 92% with an ear of at least 1cm visible. Spring barley is 96% emerged. Corn planting is 4% done versus 17% complete this time last year.

Demand for North Africa and elsewhere remains pretty strong, but competition for this business is usually fiercely fought over. Euro weakness is an assist in this department.

The US 2016 wheat harvest will soon be upon us, and that has also escaped the worst of the winter based on current crop ratings.

US growers traditionally have "longer pockets" than their FWU counterparts, the latter can't await for the market to "come to them" and must be in their pitching aggressively from Day 1.

Look for wheat to grind lower heading into harvest pressure...



15 April 2016 | EU Reports
14/04/16 -- EU grains traded mixed, with wheat unfortunately the weakest leg of the gang.

At the finish, front month May 16 London wheat was down GBP2.20/tonne at GBP103.10/tonne, May Paris wheat was EUR0.50/tonne lower at EUR156.25/tonne, June corn jumped EUR0.50/tonne to EUR156.25/tonne and rapeseed closed EUR2.00/tonne higher at EUR371.75/tonne.

FrnaceAgriMer made a few downwards adjustments to their French 2015/16 grain ending stocks estimates. Essentially these were small downwards revisions to carryout due to better than anticipated exports to North African destinations like Morocco and Algeria that have shown up in recent tenders.

French wheat stocks were cut by 0.6 MMT, and those for barley reduced 0.5 TMT, at the end of the current season.

"Looking ahead, Moroccan millers and the countries wheat trade federation have requested that this season’s import window is extended to the end of May (rather than April), and that next season’s window opens in August (typically October). This suggests further export opportunities for France, but also potentially UK supplies of wheat," noted the HGCA.

Maize end stocks (French corn carryout) were also reduced slightly (by 200 TMT), as a result of higher demand from the domestic starch industry, they added.

It is still worth remembering that these inventory volumes are still historically high, especially with another anticipated bumper crop not far away now.

French analysts Strategie Grains joined the chorus, reducing EU-28 soft wheat ending stocks by 1 MMT to 15.6 MMT.

Looking ahead winter grains in Europe are "in very good condition… with very promising yield outlooks in France, the UK, Germany, central Europe and south east Europe," Strategie Grains said.


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