David Sheppard, managing director at gleadell, offers up-to-the-minute insight into the global wheat markets.

Markets have been quiet over the past week with little fresh fundamentals to drive price direction. The fluctuations of the Euro against the US Dollar have been the main driver, as fears remain over the Euro-zone debt crisis and ongoing concerns over global economic growth.

Regarding wheat supply, there are few concerns relating to the 2011 harvest with northern hemisphere crops now made and prospects remaining good for Australia and Argentina. Early indications for 2012 would point to another bumper crop, with US plantings projected to remain unchanged and Strategie Grains projecting the EU crop up 5%.

The dryness in the Ukraine and parts of the Midwest are potential worries, but it would take a major crop/weather problem to develop to change the current bearish scenario.

• Summary:
• Russia exported a record 3.2mln/t of wheat in September and expects continued exports into the New Year.
• Egypt’s GASC purchases 240,000 tonnes of Ukraine/Russian wheat for February shipment.
• Russia may export up to 17mln/t of grain by year-end with plans to export 24-25mlnt in 2011/12 grain year.
• Australia’s CHB sells 150,000 tonnes of wheat to Saudi Arabia.
• Ukraine grain stocks reported as of November 1^st at 27.3mln/t up 44% from the same time last year.
• Ukrainian Agriculture Ministry raises 2011 grain harvest forecast to 56mlnt from 53-54mlnt previously.
• Strategie Grains raises 2011 EU-27 soft wheat crop to 129.5mln/t and sees 2012 EU-27 crop up 5% at 135.8mln/t.
• Australian 2011/12 wheat harvest runs the risk of quality downgrades following wet weather – Cargill.
• Approx one third of Ukraine’s winter crops remain in poor condition due to severe drought during sowing period.
• UK wheat exports picked up in September at 277,315 tonnes, year to date figure 559,020 tonnes down from 861,666 tonnes last season.