An encouraging lift in wheat prices as a result of Canadian &...

An encouraging lift in wheat prices as a result of Canadian & Ukraine wheat woes, while Russia's doing well, as reported in Agrimoney:

"Canada's wheat hopes crumble, as Russia's improve
As one door opens, another closes.

Russia's return to wheat shipments looks to be even more impressive than had been thought, with the US Department of Agriculture on Tuesday hiking by 2.0m tonnes its forecast for exports from the Black Sea powerhouse in 2011-12.

The upgrade reflected higher hopes for Russian stocks left over from last year's drought-affected harvest ?and the country's renowned competitiveness in tenders, which has been a big factor in depressing world wheat prices.

"Exports are raised for Russia as relatively low prices make Russian wheat competitive into North Africa and Middle East markets," Karis Gutter, America's acting secretary of agriculture, said in the USDA's much-watched Wasde report.

Russian wheat was earlier this week being offered about $30 a tonne lower than European Union supplies, traders said.

'Reduced vegetative vigour'

Furthermore, Russia looks set to face less competition from Ukraine, where harvest hopes have been trimmed by less benign weather.

"Persistent spring dryness in the north central areas stressed developing plants and appears to have limited vegetative growth," the USDA said, cutting its forecast for Ukraine's harvest, and exports, by 1.0m tonnes apiece.

A crop tour had revealed "that plant density on many wheat fields was lower than average", while satellite data showed "reduced vegetative vigour in late May and early June, when winter grains are advancing through the reproductive stage and the vegetative indices typically reach peak values".

'Flooding, hail, and disease'

In Canada, production and shipments forecasts were both slashed by 3.5m tonnes and 2.5m tonnes respectively, reflecting the dismal spring which looks set to leave farmers harvesting their lowest acreage since the early 1970s ? when the country had subsidies for non-production.

"Canada's production is lowered? as persistent heavy rains and flooding well into the second half of June limited planting opportunities for spring wheat in south east Saskatchewan and south west Manitoba," the USDA said.

In the two provinces, which account for nearly two-thirds of Canadian wheat output, "the planting campaign encountered difficulties caused by snow melt, heavy rains, and below normal temperatures which resulted in waterlogged soils."

And now Saskatchewan and Manitoba "are reporting crop damage due to flooding, hail, and disease".

Filling the void

The net gap in exports created by the revisions, at a time when prospects for feed wheat consumption are rising, would be met in part by the US, which is now expected to see exports fall far less than had been thought in 2011-12, to 31.3m tonnes.

This would see domestic wheat inventories fall a little further than had been thought over 2011-12, despite a hard red winter wheat harvest which had beaten worst expectations.

The estimate for world wheat stocks at the close of the season was lowered by 2.1m tonnes to a three-year low of 182.2m tonnes.

Indeed, world wheat consumption was now expected to exceed production by 7.6m tonnes, more than twice as much as predicted in last month's Wasde.

The data helped a revival in wheat prices from early losses, with Chicago's September contract jumping 5% in late deals.

Most of the surge came to late to help European contracts, seeing Paris wheat end up 0.2% and London's November lot post a 0.6% loss."

http://www.agrimoney.com/news/canadas-wheat-hopes-crumble-as-russias-improve---3358.html