Global wheat futures (May 22) once again rose last week, due to ongoing concerns about global wheat supplies.
However, prices eased back from mid-week onwards due to reduced trade, as the US markets closed on Thursday for Thanksgiving amid worries about the new COVID-19 variant, according to the AHDB.
It is anticipated that the EU-27 will export 32.0m tonnes (Mt) of soft wheat in 2021/2022, according to the EU Commission. This is up 2.0Mt from last month and 4.6Mt more than last season, but still below 2019/2020's 36.8Mt.
This will result in lower closing stocks, the AHDB says. Strong demand for European wheat is one of the factors supporting prices and this could persist, given the Russian export tax is set to rise again this week.
A La Niña weather event is underway, according to the Australian Bureau of Meteorology. The Australian harvest is being disrupted by rainfall, a common feature of a La Niña in Australia.
Early reports suggest that yields are good, but the rain is causing concern for quality. This could be supportive of milling wheat markets.
Some of this support could be tempered if there continues to be positive results from the Argentine wheat harvest. Yields are improving as the harvest progresses in the central regions.
The AHDB states that an important factor in the weeks ahead for all grain prices will be South American maize crops. These crops are forecast to account for 8% of global grain output this season.
La Niña has the potential to reduce rainfall here. But so far, early crops are off to an encouraging start and were boosted by rain over the weekend.
Chicago maize futures for May 22 also rose last week. On Friday, the US reported new export sales totalling 1.43Mt of maize in the week ending 18 November, above trade expectations.
Last week, oilseeds market sentiment was dominated by worries over the new COVID-19 variant (Omicron), causing broad-based selling in commodities.
As such, it was a volatile week for Paris rapeseed futures (May 22). They closed on Friday at €648.50/t, down €3.50/t across the week, but losing €14.75/t on Friday’s trading. Gains earlier in the week partially compensated for this loss.
The Irish Farmers Journal will hold a webinar on 1 December at 8pm on the outlook for the grain market. Watch the webinar on ifj.ie/tramlines.