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03/02/12 -- EU grains finish mixed but mostly higher
with Mar 12 London wheat up GBP0.45/tonne to GBP167.45/tonne and Mar 12 Paris
wheat rising EUR1.50/tonne to EUR217.25/tonne.
On the week overall London wheat was up GBP2.90/tonne
and Paris wheat rose EUR8.25/tonne. London wheat set a near five month high
this week, with Paris wheat rising to its best levels in almost eight months.
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Russia surprised the market by saying that it was putting
off a decision on restricting grain exports to another day, and then promptly
announcing that 27 MMT was a level it would be comfortable with and that the
government "doesn’t see grounds for any kind of grain export restriction
in April this year".
It had been suggested by many that the latter scenario
was likely given the existing rate of shipments.
They are said to have exported just over 19 MMT in the
July/Jan period, with January's figure being around 1.1-1.3 MMT, so the rate
of exports has certainly slowed considerably. That is partly a function of the
weather, but it also seems clear that a lot of it is down to Russian offers
not being as uber-competitive as they were.
Now that this issue has been cleared up, at least for
now, the trade can fret over something else. Step forward this week's ultra
cold weather in eastern Europe, pushing west into France and Germany. How much
damage will that do to winter crops? The jury will remain out on that one for
some time yet.
Elsewhere, the USDA attaché in Argentina estimates
corn production there at 21.8 MMT, more than 4 MMT below the current USDA figure.
Exports are seen at 14 MMT, 3.5 MMT below the current USDA estimate.
Stats Canada estimate wheat stocks there at 20.962 MMT,
a little higher than the trade expected.
Brussels issued soft wheat export licences for 178 TMT
this past week, bringing the year to date total to 8.1 MMT, 36% down on year
ago levels. Exports have been pretty poor for the last six weeks, which is a
long time to get over a Christmas hangover!