STOCK MARKET WATCH - Thursday, 22 March 2012

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45. European Crops Damaged by Winter Freeze Now Face Drought

http://www.bloomberg.com/news/2012-03-22/european-crops-damaged-by-winter-freeze-now-face-drought.html

European wheat and rapeseed crops are at risk of drought that may further hurt yields after freezing weather last month destroyed some fields, analysts and forecasters said.

France, Spain, England and northern Italy got less rain than normal since the start of January, European Union weather data show. They will probably stay drier and warmer than usual in the next 30 days, said Joel Burgio, an agricultural meteorologist at Telvent DTN.

The 27-nation EU typically grows about 20 percent of the world’s soft wheat. A cold wave in February may have lopped 5 million metric tons off this year’s harvest, and a lack of rain might further harm EU output, according to Alexandre Marie, an analyst at French farm adviser Offre et Demande Agricole.

“The situation in Europe is alarming,” Marie said by phone yesterday from Bourges, west of Paris. “That will remain a factor of support for the market in coming weeks.”