RAIN HAS continued to interrupt the European grain harvest.

In many countries the barley harvest has been prolonged and the start of the wheat harvest in Northern France, Germany and Denmark has been delayed.

The wheat harvest has been completed in the southwest of France and Italy, while the Spanish wheat harvest is expected to continue into the first week of August.

German barley yields have not turned out as big as anticipated, while early French wheat samples indicate qualities above expectations.

Early cut Hungarian wheat also suggests a good quality crop, but only 40% has been cut so far.

This contrasts with Spanish and Italian wheat crops, which show protein values below those of last year.

Rain and its impact on quality continue to concern Ukrainian and Russian producers.

These factors have supported Russian milling wheat prices to $130/t (£72/t) ex-silo, according to Russian trade sources.

Harvest reports from across Europe confirm that yields are up on last year.

This confirms earlier assessments of a large EU grain crop. As a result France (the largest EU grain producer) raised its wheat forecast by 300,000t to 36.6 million tonnes last week (+25% on 2003).

The anticipated larger EU wheat crop and hence a larger EU exportable surplus continue to weigh on prices.

But uncertainty about the quality of this year‘s wheat crop remains, as only a small percentage of the EU wheat crop has been cut and harvesting and ripening of the remainder has been delayed.