Jonathan Lane, Trading Manager at Gleadell, recounts the week’s developments in the global grain markets, where weather concerns continue to dictate market movements, although European farmers have benefitted from a reprieve this week.

Corn plantings, although progressing at a faster-than-average pace, slowed last week as wetter, colder conditions returned to the Midwest. Spring wheat is also progressing well ahead of the norm, with 57% planted compared with an average of 19%. Crop ratings reversed last week with all-US ratings dropping 1%, although ratings for SRW actually improved by 3 points. Drier conditions this week and into the weekend should see planting pace pick up again, as the perceived end to the optimum ‘planting window’ draws closer.

EU prices have again been driven by weather concerns. Following last week’s downward revision of French and German estimates, news came that almost a third of Polish winter grain/oilseed sowings have been destroyed. While the west of the region has received beneficial rainfall that should limit further losses, the east is still suffering from drier than normal conditions.

Weather concerns continue to support EU markets, while US grain markets remain under pressure due to burdensome stocks/new crop production prospects. New crop demand remains routine, although some Chinese trade has been reported, but fresh interest may require lower prices than today.

• USDA report corn plantings 28% complete, 17% last week, 8% last year and 15% average.
• Canadian farmers are planting more wheat than expected – may rise 13% to 24.3mln acres.
• EU’s crop-marketing unit raises wheat yield forecast for 2012/13 to 5.68t /ha, up 1.8% on 2011.
• Spain’s wheat and barley crops in the North may benefit from recent rains after a long drought.
• Ukrainian farmers have almost completed 2012 spring wheat at 3.6mln ha, 96% of the   expected area.
• Russian wheat prices continue to decline due to weak demand and intervention sales from state inventories.
• India eyes record wheat harvest (90.2mln/t) – increasing potential for exports.
• EU has little scope to absorb grain ‘supply shock’ – start of a critical period for wheat yields.
• Severe frosts and adverse weather have destroyed 29% of Poland’s winter grain/rapeseed winter plantings.
• Ukraine 2012 wheat harvest could fall to 11-14mln/t, due to poor weather during the sowing season.
• UN’s food agency reports that Kazakhstan faces ‘moisture deficit’ with higher-than-normal winterkill.
• Moroccan AgMin predicts 2012 grain harvest at 4.8mln/t, above recent forecast but well below the 8.4mln/t last year.