May 29, 2012
EU wheat falls as rains seen augmenting Europe crops
For the first time in three sessions in Paris, milling wheat dropped on speculation that warm weather and rains this week will improve the prospects for crops in parts of Europe and Russia.
Areas of southern and central England may have showers in the evening, while temperatures Monday (May 28) could climb as high as 27 degrees Celsius (81 degrees Fahrenheit), according to the Met Office. Rains may fall in parts of Ukraine starting Monday (May 28) and areas of southern Russia beginning May 30, according to AccuWeather Inc.
"This heat we've got at the moment is exactly what the crop needed," Dave Norris, an independent grain broker in Harrogate, England, said by phone. "It's come on enormously in a week, and we're set to have a bit of rain."
Milling wheat for November delivery fell 0.2% to settle at EUR216 (US$270.82) a tonne on NYSE Liffe in Paris by 6:30 p.m. local time, after swinging between gains and losses. The grain, which climbed for a third straight week last week, has gained 6% this month and 11% this year.
World wheat output will decline 3.5% in the 2012-13 crop year to 670.5 million tonnes as poor conditions weigh on prospects in Russia, Morocco and the EU, the London-based International Grains Council said May 24.
The winter grain harvest in Ukraine will drop by 43% this year to 14.5 million tonnes, the Interfax news agency reported Monday (May 28), citing Mykola Kulbida, head of the Meteorology Centre.
"The focus is upon one thing and one thing only these days: the quality and size of the Russian and Ukrainian winter wheat crops," economist Dennis Gartman said in his daily Gartman Letter.
Rapeseed futures for November delivery increased by 1% to EUR467 (US$585) a tonne in Paris. Markets on the Chicago Board of Trade were closed Monday (May 28) for the Memorial Day holiday.