The November dried feed wheat price was trading at about €178/t yesterday (Wednesday), while the equivalent dried barley price was in the €165/t to €168/t range.

This would indicate a green barley price at harvest of about €128/t to €130/t, which is significantly lower than last year. Based on the above, wheat would be at a differential of between €10 to €12 or €138/t to €140/t. It is still early days and there will be pressure in the trade to value the crop higher than this.

Although little comfort to tillage farmers coming to terms with the lower prices, yields are reported to be good. However, quality is mixed. According to the trade, there is little or no carryover of old crop wheat, but there are small volumes of barley around, which should move between now and September.

The continuing downward pressure on grain prices is causing buyers to step back from the global market. Maize is driving the price decline in all major grain growing regions where big crops combined with good growing conditions are reported.

While heavy rains across the Black Sea, Eastern Europe and France are threatening wheat quality, they are seen as beneficial for the developing maize crop. Meanwhile in the US, where wetter and cooler weather is slowing the winter wheat harvest, it is aiding the maize crop.

It will take a major weather or political event to turn the table and unfortunately the sentiment is unlikely to firm in the short term due to the abundance of maize.

Markets have also reacted negatively after the release of the US Department of Agriculture’s quarterly stock and production report this week. It confirmed that 75% of the US crop is in good to excellent condition, which is said to be the highest rating in 20 years at this point.

It also showed that soya plantings and stocks were at higher-than-expected levels, while bumper yields on its corn crop are expected to produce a bigger harvest than in 2013, despite the planted acreage falling by 4%.

Russia’s harvest is also gathering momentum, and wheat yields there are up 17% on last year while their barley yields are 10% ahead.