Futures grain prices for December broke the €300/t barrier on Monday and hit €313/t at the time of going to press on Wednesday of this week.
This has also pushed up physical prices here, with nearby wheat now in the €305 to €310/t range. Dry barley has also broken €300/t, with prices this week in the €300/t to €305/t range.
Futures prices had danced either side of the €300/t mark in recent weeks, but they never closed at or above that level until this week.
Now that the barrier has been broken, we must wait and see where markets move to from here.
The most recent spurt in prices seems to have been driven by two main factors; quality issues in the Australian wheat crop and the closure of some rail lines in Canada due to flash flooding.
These two issues point to the fact that global wheat markets are being heavily driven by the severe tightness in milling wheat supply, rather than total wheat availability.
The strengthening in the futures markets could be seen in all contract positions this week, including new crop prices for December 2022.
All new crop positions have now passed €273/t for wheat on MATIF (Paris-based futures).
Even before the most recent increases in the December 2022 contract position, Glanbia had offered its growers €257/t for dry wheat for November 2022 and €247/t for dry barley.
While these markets seem set to remain buoyant, it is likely that we will continue to see a level of volatility in markets on both sides of the Atlantic.
However, it is still possible that feed markets will ease back if global maize production increases next year to exceed predicted demand.