June 1, 2009

 

EU wheat ends down following bearish global wheat output data

 

 

European wheat futures ended lower Friday (May 29) following a bearish revision to the International Grains Council's 2009-2010 global wheat crop forecast.

 

The council raised its 2009-10 wheat crop forecast by 0.2 percent from April's estimate to 652 million tonnes.

 

"Although the world wheat crop estimate (has) increased because of significant upward revisions for China and Russia, markets reacted nervously to the very difficult spring planting conditions in parts of North America and overly dry weather in southern and eastern Europe," IGC said.

 

A UK-based trader echoed similar views, noting that "The weather is very good this week but in two weeks (the same sunny weather) could be a concern."

 

He said farmers are reacting to market uncertainty about the weather by withholding wheat sales in hopes that prices will rise even more.

 

November Paris milling wheat trades down EUR0.25, or 0.2 percent, at EUR161.50 a tonne, with 5,847 lots moved. London November feed wheat trades down GBP0.50, or 0.4 perecnt, at GBP131/tonne, with 837 lots moved.

 

A Paris-based trader said European wheat prices could have fallen more on bearish sentiment from the IGC's wheat forecast but were slightly buoyed by higher US wheat futures.

 

US wheat futures are rising due to the weaker dollar against most currencies and the ICG's downward revision to its 2009-10 corn output forecast, which helped support the entire US grains complex, the trader said.

 

Standard-quality wheat prices in the French cash market delivered at Rouen rose to EUR142 a ton from Thursday's price of EUR139/tonne.

 

Liffe's Paris August rapeseed traded down EUR0.75, or 0.2 percent, at EUR318.25/tonne with 1,063 lots traded. Liffe's Paris June corn traded down EUR2.75, or 1.7 percent, at EUR159.79/tonne, with 505 lots moved.