The day ended with benchmark Nov 16 GBP0.70/tonne higher at GBP125.70/tonne.
Sep 16 Paris wheat traded up EUR04.25/tonne at EUR166.00/tonne, Aug corn was
EUR1.25/tonne lower at EUR168.75/tonne and Nov16 Paris rapeseed was EUR0.750/tonne
firmer at EUR362.00/tonne.
For the week. that puts London wheat down GBP0.30/tonne, Paris wheat down EUR8.00/tonne,
corn EUR2.75/tonne weaker and rapeseed up EUR1.25/tonne.
The IGC estimated the global wheat crop at 735 MMT, up 6 MMT from previously.
The EU all wheat crop was placed at 149.0 MMT, down 5.6 MMT from last month
(and soft wheat at 139.9 MMT).
ODA just yesterday forecast an EU soft wheat crop of only 134 MMT, whilst the
USDA currently predict an EU all wheat crop of 156.5 MMT, so there are some
fairly wide differences of opinion there.
The IGC estimate EU all wheat exports in 2016/17 at 30.8 MMT, down 3.8 MMT
on a month ago and 13.7% below those of last season, whilst the USDA are still
at 34.0 MMT.
The IGC upped their forecast for Russian wheat production from 63.0 MMT to
67.5 MMT, as well as Ukraine (23 MMT to 25 MMT), Australia (25.5 MMT to 26.0
MMT) and the US (56.6 MMT to 61.5 MMT).
The Russian Ag Min said that their 2016 grain harvest was 22.5% complete on
10.7 million ha for a crop of 41.4 MMT to date. Wheat production stands at 33.3
MMT off 29.1% of plan.
Brussels announced that they'd released 413 TMT worth of soft wheat export
licences this past week, which takes the new season total so far to 2.2 MMT
versus 1.6 MMT a year ago.
FranceAgriMer cut French winter wheat crop ratings again, down 2 points on
a week ago to 42% (77% this time in 2015). They said that harvesting of wheat
is now 41% complete (barley 100% done).
At home, ADAS said that the UK 2016 barley harvest was 35% complete, and that
15% of the OSR crop was in the barn. Yields for both vary quite dramatically,
but typical barley yields are coming in at around 6.0-6.6 MT/ha and at 2.9-3.4
MT/ha for OSR.
The German harvest is progressing nicely and yields/quality are said to be
not as bad as some had feared. Most of the wheat crop in the south will only
make feed grade though.
At the close Nov 16 London wheat was up GBP1.25/tonne at GBP125.00/tonne, Sep
16 Paris wheat was up EUR2.00/tonne to EUR165.75/tonne, Aug Paris corn was up
EUR0.25/tonne at EUR170.005/tonne and Aug 16 Paris rapeseed was EUR3.25/tonne
higher at EUR361.25/tonne.
ODA released an EU-28 soft wheat production estimate of 134.0 MMT, down 17
MMT (or 11%) on last year. They said that the French crop may only muster 30.4
MMT, with the potential to further deteriorate to just 29.4 MMT as the harvest
The USDA's attache in Europe is predictably less concerned, predicting an EU-28
all wheat crop of 154.5 MMT, down 4% from last year's 160 MMT (durum wheat production
in Europe is typically around 8-9 MMT in any given year).
They did however warn that production could be lowered again as the harvest
progresses. They see 2016/17 exports at 4-year low of 30.5 MMT, down 9% compared
Rabobank came in a bit lower in production than the USDA at 154.0 MMT.
Production and export estimates for Russia continue to rise to new record levels
as they look well placed to take advantage of Europe's misfortune this season.
IKAR raised their forecast for the 2016 Russian grain crop by 2 MMT to 114
MMT (2015: 104.8 MMT), with wheat output up 1 MMT to a record 69 MMT and exports
at a record 29 MMT (2015/16: 24.5 MMT).
Rabobank have the Russian wheat crop at 65.6 MMT and 2015/16 grain exports
at 27.1 MMT.
They also see this year's Australian wheat crop at an impressive 26.7 MMT (USDA:
Egypt tendered for wheat for Sep 1-10 shipment, booking one cargo each of Romanian
and Russian wheat. French wheat wasn't offered. Rumour suggests that France
may even have bought a cargo of Romanian wheat themselves to bolster concerns
over new crop quality.
The day ended with Nov 16 London down GBP0.55/tonne at GBP123.75/tonne, Sep
16 Paris wheat was EUR2.50/tonne lower at EUR163.75/tonne, Aug corn was down
EUR0.25/tonne at EUR169.75/tonne and Aug 16 rapeseed was up EUR1.50/tonne to
The jury is still out as to exactly how bad the French wheat crop is. CRM AgriCommodities
today released an average yield estimate for France of only 5.5 MT/ha, a 30-year
low. Using the Ag Ministry's own area estimate of 5.22 million ha, that would
give us a final production figure of only 28.71 MMT - and that is assuming that
everything gets cut and doesn't go for whole crop silage or similar.
The yield figure of 5.5 MT/ha is well below the 7.23 MT/ha served up to us
by MARS earlier in the week. ODA suggested production "below 30 MMT this
week and Agritel say 30-32 MMT.
The official French Ministry estimate of 37 MMT was only released as recently
as Jul 12. Production last year was officially 40.7 MMT, so these private numbers
are suggesting a drop of 8.7-12 MMT this year, or 21-29%.
Either way, large carryover stocks from 2015/16 suddenly don't seem so important,
they are in fact necessary. The uncertainty will no doubt have been a factor
in the lack of French offers at the two recent Egyptian tenders.
If we switch our attention to the UK now, MARS came up with an average wheat
yield of 8.09 MT/ha for us this year in this week's report. Multiplying that
out by 1.794 for the GB wheat area from the HGCA gives a 2016 wheat crop of
14.5 MMT against 16.44 MMT last year - down 11.8%.
For OSR, the HGCA have a England & Scotland OSR area of 591k ha, add on
another 5k ha for Wales (the area planted in 2014 and 2015) and multiply up
by a MARS average yield of 3.17 MT/ha this year and we get a 2016 UK OSR crop
of 1.89 MMT.
Note that early yields OSR and barley in the UK are so far said to be pretty
disappointing and it looks like the MARS yield figures could be a bit overstated.
MARS said themselves that there is "a high margin of uncertainty in our
yield forecasts" for the UK this year.
So the French wheat crop could be 12 MMT down on a year ago, and the UK may
have lost another 2.0-2.5 MMT, with Germany expected down a similar amount.
Interesting, especially come the second half of the season once cheap FSU offers
start drying up.
UKraine said that their early grain harvest was 69% complete on 3.69 million
ha for a crop of 24.79 MMT to date. That includes 16.61 MMT of wheat off 68%
of plan. They've also harvested 7.39 MMT of barley off 78% of plan and 81% of
their OSR for a crop of 962 TMT so far.
The day ended with benchmark Nov 16 GBP1.35/tonne lower at GBP124.30/tonne.
Sep 16 Paris wheat traded down EUR4.25/tonne at EUR166.25/tonne, Aug corn was
EUR0.75/tonne lower at EUR170.00/tonne and Aug 16 Paris rapeseed was down EUR1.50/tonne
MARS raised their overall EU-28 soft wheat yield estimate from
6.07 MT/ha last month to 6.10 MT/ha, and a 4.6% rise on last year.
They were also up slightly on corn, from 7.35 MT/ha to 7.42
MT/ha, a 1% increase versus 6.93 MT/ha a year ago.
Barley yields were lowered slightly, from 5.01 MT/ha to 4.99
MT/ha (2015: 4.72 MT/ha), along with those for OSR - down from 3.24 MT/ha to
3.22 MT/ha (2015: 3.20 MT/ha).
They downgraded expectations for French wheat yields, but not
by that much - lowered 0.9 MT/ha to 7.23 MT/ha.
"The poor conditions observed in late May continued in
June with substantial rainfall, exceptionally low global radiation and near-average
temperatures. Overly wet conditions led to saturated soils. Consequently, yield
forecasts are revised downwards to average levels," they said.
UK wheat yields were seen unchanged from a month ago at 8.09
"Crop development and biomass accumulation (in the UK)
are mainly above average, but pest and disease pressure remain high. The yield
forecasts remain close to or slightly above the five-year average," they
OSR yields in France were pegged 8.6% lower than a year ago
at 3.26 MT/ha, and those in the UK 2.5% lower at 3.17 MT/ha.
Elsewhere, big crops keep getting bigger. Rusagrotrans said
that this year's Russian grain crop could reach 113 MMT - the highest they say
Wheat could account for 68.4 MMT of that total (record) and
barley 17.8 MMT. Corn production still depends on August weather, but could
exceed last year's record 13.2 MMT, they noted.
At the close Nov 16 London wheat was down GBP0.40/tonne at GBP125.675/tonne,
Sep 16 Paris wheat fell EUR3.50/tonne to EUR170.50/tonne, Aug Paris corn was
down EUR0.75/tonne at EUR170.75/tonne and Aug 16 Paris rapeseed was EUR0.25/tonne
higher at EUR358.00/tonne.
Nov 16 London wheat had earlier touched GBP128.50 - it's best level since early
November. Sep 16 Paris wheat meanwhile hit EUR177.25/tonne - a level not seen
Having downgraded the French wheat crop to 32 MMT from 35 MMT just last week,
ODA went one further today calling the crop at 30 MMT or less - a 40-year low.
They are now the most bearish of the private estimates (Agritel go 32 MMT)
but not by an outrageous amount. Production last year was almost 41 MMT, so
despite a larger than normal carryover into 2016/17 French exports are clearly
going to be hit quite hard, especially in the second half of the season one
Production in Germany is forecast 19% lower by Agritel at 26 MMT, and in Poland
it is seen 10% down at 10.7 MMT. The UK jury is still out, although output is
definitely expected to drop here too.
Russia's wheat harvest has no such troubles foreseen, and is complete on 7.2
million ha for a crop of 29.8 MMT so far. The barley harvest is complete on
1.1 millin ha for a crop of 3.8 MMT to date.
Their grain exports via seaports picked up last week to 308,100 MT from 204,400
MT the previous week. Wheat accounted for 227,100 MT of that total.
By contrast Ukraine's seaport exports fell to 149,500 MT from 423,500 MT),
including 18,900 MT of wheat, 12,300 MT of corn and 115,200 MT of barley.
Kazakhstan will produce 13 MMT of wheat this year, down from 13.75 MMT a year
ago as producers there diversify into other crops, say the Ag Min there.
Morocco tendered for 133,000 MT of soft wheat. Iran were said to have bought
350,000 MT of EU/Baltic origin wheat for Oct/Nov shipment.
The day ended with new front month Nov 16 London up GBP2.05/tonne at GBP126.05/tonne,
Sep 16 Paris wheat was EUR7.00/tonne higher at EUR174.00/tonne, Aug corn was
up EUR2.25/tonne at EUR171.50/tonne and Aug 16 rapeseed fell EUR6.25/tonne to
For Paris wheat this was the highest front month close of 2016 so far following
the news that ODA had downgraded their French wheat crop estimate this year
by 3 MMT to 32 MMT. Production was almost 41 MMT a year ago, so we're looking
at a near 22% decline, and the lowest output since 2007 here.
FranceAgriMer backed-up the downgrade by dropping it's estimate for the proportion
of the crop rated good to very good by 7 percentage points to just 42% (76%
a year ago). They said that harvesting of French wheat was 17% complete versus
7% last week and 53% this time last year.
The French winter barley crop was seen at 42% good to very good, down 2 points
and well below 86% this time last year. Harvesting of that is 95% complete.
Spring barley was put at 60% G/VG from 62% last week and 64% last year. Harvesting
of that crop is 7% done versus 3% last week and 38% last year.
The French corn crop was seen unchanged at 69% G/VG (62% last year), and silking
is at 13% (3% last week and 73% last year).
RusAgroTrans lowered their forecast for Russia's July grain exports from 2.5
MMT to 2.0 MMT. The revision is a result of reduced demand from Turkey and some
trader/grower reluctance ahead of the anticipated removal of the export tax
on wheat at the end of this month.
The Russian Ag Min say that this year's wheat harvest now stands at 28.1 MMT
of 6.7 million ha. Yields are averaging 4.17 MT/ha versus 3.79 MT/ha a year
ago. They've also harvested 3.6 MMT of barley.
Ukraine say that they've harvested 61% of the planned early grains area (or
5.88 million ha) for a crop of 21.34 MMT to date. Wheat accounts for 3.554 million
ha (57% of plan) for a crop of 13.8 MMT so far. Barley adds another 6.83 MMT
off 73% of plan.
They say that they've already exported 1.443 MMT of grains so far this new
season, including 760,000 MT of barley, 297,000 MT of wheat and 386,000 MT of
21/07/16 -- EU
grains closed mostly firmer on strong exports and continued French crop downgrades.
The day ended with
benchmark Nov 16 London wheat GBP2.35/tonne firmer at GBP125.80/tonne. Sep 16
Paris wheat traded up EUR6.50/tonne at EUR167.00/tonne, Aug corn was EUR1.75/tonne
firmer at EUR169.25/tonne and Aug 16 Paris rapeseed was down EUR0.50/tonne at
that they'd released 826 TMT worth of soft wheat export licences this past week
along with 191 TMT worth for barley.
That takes the
cumulative total on wheat to 1.814 MMT just 3 weeks into the new season, some
44% more than this time a year ago.
for the season so far are now 619 TMT, some 47% below this time last year.
of total wheat exports to date is 23.5% and for barley 30.4%.
Tunisia were confirmed
to have bought 117,000 MT of soft wheat, 75,000 MT of barley and 109,000 MT
of durum wheat in their tender, all of optional origin.
Reports out of
France, where Agritel yesterday described the crop as "very, very bad"
continue to suggest poor yields and bushel weights. It is also probably likely
that protein levels will have been compromised.
update us Friday morning on crop progress, although the figures given will only
be as of Monday. Last week's good to very good ratings fell 10 percentage points
Agritel also tell
us that they estimate that only 40% of this year's Ukraine wheat crop will make
milling standards as opposed to 50% on average for the last 3 seasons.
In Russia the 2016
wheat harvest is said to be 26.7 MMT already, with yields averaging 4.22 MT/ha
vs. 3.78 MT/ha a year ago.
At the close Jul 16 London wheat was unchanged at GBP111.75/tonne, Sep 16 Paris
wheat was up EUR0.25/tonne to EUR160.50/tonne, Aug Paris corn was down EUR1.75/tonne
at EUR167.50/tonne and Aug 16 Paris rapeseed was EUR4.50/tonne higher at EUR364.50/tonne.
Agritel forecast the Germany wheat crop at 26 MMT, which is 1 MMT more than
DRV's estimate from Friday, and 1.9% down on last year's bumper result.
The UK combines are still waiting to get going, but an average harvest of around
15.3-15.5 MMT is expected rather than a bin-buster.
Switch to Ukraine where things could be described as "very good"
the wheat harvest is already 47% complete at 11.3 MMT. They've brought in a
further 6 MMT of barley, off 65% of the planned area and 62% of the winter OSR
crop producing 720 TMT of the oilseed so far.
The UKraine Ag Ministry predict a grain harvest in excess of 60 MMT for the
4th year in a row, and growers there are said to have already started planting
OSR for the 2017 harvest.
In Russia things are more like "very, very good" - they've produced
25.1 MMT of wheat off 5.9 million ha and yields are up 12.4% at 4.25 MT/ha.
In addition they've cut 916k ha of barley producing a crop of 3.4 MMT so far.
Yields are up 5% at 3.69 MT/ha.
UkArgroConsult said that Russia's share of the global wheat export market would
grow to 16% in 2016/17 versus 14.1% last season. France's share by contrast
will fall to 11% from 12.1%.
Jordan cancelled a tender to buy wheat. Syria were said to have bought 200,000
MT of Russian wheat. Tunisia tendered fro 120,000 MT of soft wheat, 67,000 MT
of durum and 100,000 MT of feed barley.
The day ended with Jul 16 London unchanged at GBP111.75/tonne, Sep 16 Paris
wheat was down EUR0.75/tonne at EUR160.25/tonne, Aug corn was EUR2.50/tonne
lower at EUR169.25/tonne and Aug 16 rapeseed fell EUR0.50/tonne to EUR360.00/tonne.
"European weather fears have supported global wheat futures in the past
couple of days. Concerns for French wheat in particular, currently rated in
especially poor condition, relate both to yields and quality of the crop. However,
from a feed wheat perspective the implication is less certain," said the
The implications for London wheat are less wheat being around thereby supporting
prices, but a higher proportion of what is available being feed wheat which
is negative for prices, they noted.
Certainly French crop conditions have dropped like a stone in recent weeks
- down 22 points in the good to very good in the last 3 weeks alone for wheat
- and early harvest results appear to confirm poor quality as well as reduced
In Germany however things don't seem as bad. DRV estimated the Germany grain
crop at 47.5 MMT on Friday, down from 48.0 MMT previously but in line with the
Winter wheat will account for 25 MMT of that total (down 4.3% on last year)
and winter barley 9.2 MMT (-4.4%). Spring barley (2 MMT) and corn (4.5 MMT)
output will be close to last year's levels.
The barley harvest is underway and throwing up a wide variety of specific weights.
The OSR harvest has also begun but it's too early to form a reliable estimate
on quality, they say. The see production at 4.9 MMT versus 5.4 MMT for the recent
In Ukraine the early grains harvest is 47% complete on 4.5 million ha producing
a crop of 16.1 MMT so far. Wheat accounts for 9.9 MMT of that with yields up
11% at 3.82 MT/ha.
The barley harvest in Ukraine is 61% complete at 5.7 MMT and the winter OSR
harvest 58% done at 676.7 TMT.
The Russian wheat harvest is reported to have reached 23.3 MMT with yields
up 14% at 4.3 MT/ha.
ProZerno forecast Russian wheat exports at a record 26 MMT in 2016/17. APK
Inform are close by at 25.8 MMT. Last season's record was unofficially 24.9
Suddenly much warmer and drier conditions in western Europe should speed up
harvest activity dramatically, although in the case of France in particular
it seems like the damage is already done.
Egypt bought 300,000 MT of Romanian/Russian wheat over the weekend for Aug
21-30 shipment in it's second tender of the new season. The prices paid were
reportedly $166.73-167.67/tonne FOB for the Romanian material and $166.50/tonne
FOB for the Russian.
That's around $2/tonne more than they paid last week for Aug 10-21 shipment,
although overall the general level of offers was lower.
APK Inform said that Russian seaports had shipped out 204,400 MT of grain last
week, up from 142,000 MT the week before. Last week's total included 103,500
MT of wheat and 95,000 MT of barley. The top home was Saudi Arabia (62,500 MT)
followed by Turkey (56,000 MT).
Despite those figures seeming to be unimpressive, the Russian Ag Ministry said
that total exports for the first two weeks of the new season were 583,800 MT,
a 34.5% increase on a year ago, Wheat accounted for 383,500 MT of that total,
according to them.
Ukraine's seaports exported 423,500 MT of grain last week, including 51,400
MT of wheat, 286,500 MT of barley and 85,600 MT of corn. Jordan was their top
buyer (56,900 MT).
The Russian Ag Min said that the wheat harvest there is already 20.5 MMT complete,
with average yields of 4.32 MT/ha (20156: 3.78 MT/ha). Barley accounts for a
further 3.0 MMT.