International grain markets continue to be very firm and this is being reflected in both futures and physical markets.

Three major factors continue to drive market sentiment – demand, weather and fund activity.

The demand relates to the unanticipated additional requirement for imports from Asia and China in particular.

The weather issues relate mainly to planting conditions in central Europe, especially in Russia, and in the US.

And funds are taking advantage of the apparent strength in the market, which could also be unloaded at some point in the future.

Native prices

Most merchants have been paying on-account for grain since harvest and some had finalised a green price of €150/t.

Growers in the south learned this week that Dairygold is to pay €157/t for green barley and €183/t for green wheat.

These prices are applicable at standard grain spec and are dependent on meeting the required minimum purchase terms.

While markets are strengthening, these price levels include support from the co-op for its growers and show a commitment to crop producers in the region. Glanbia is now expected to agree its prices later this week.

In the dry markets, nearby wheat has moved up to the €203 to €207/t range, depending on location and position.

At this point, the stronger prices are largely available for the new year, but some merchants are currently offering €204/t.

Barley has not moved as much because there are more sellers and because UK imports are currently holding back prices. But a move to other supply sources in January (post-Brexit) could see imported barley rise above €200/t and that may influence internal prices.

Maize is stronger

Global maize prices were supported last week by the reduced production estimate in the US, which cut production by 4.5mt from its previous estimate. This factored in the damage caused by last month’s storms.

That said, harvest progress is good in the US and so are farm yields. Growers there are now benefiting from an unexpected price increase on top of generally very good yields.

That supply and demand report from the US also indicated a reduction in domestic usage for feed and ethanol production.

However, it still indicated that domestic and global end-of-season stocks are expected to be lower.

This change in outlook has seen ex-port prices here for November maize increase from just over €170/t back in August to €205/t currently.

Oilseed rape

Rapeseed markets have benefited from the recent strengthening in soya bean markets, with MATIF futures in the mid-€390s for the new year. And the dryness issue across the Black Sea region is also likely to support prices until the Australian crop becomes available.