Futures positions for most grains continue to bounce about, up one day down the next, leaving prices volatile but in a tighter band.

The 2000 ruble tax on wheat exports from Russia from mid February continues to weight on the market. The falling value of the ruble is lowering the tax, which was €22.45 last week and €21.78 this week .

The tax is an effort to stabilise domestic food prices within Russia and slow export shipments from there. The AHDB now estimates exports of 37.5mt of wheat from there, down from 40mt because of the tax.

This will add some support to the market but, given the tight supply in the EU, other exporting countries will be more likely to benefit. Countries like Argentina and Australia will be better able to capitalise on this situation to win more export business.

Some believe that the reduction in Russian exports will be offset by the additional increases expected in Australian production.

That said, the AHDB report that Stratégie Grains increased its forecast for soft wheat exports from the EU/Britain for 2020/21 from 24.3mt to 24.7mt. This has large a result of exports from France to China.

There are also supply concerns from Ukraine where wheat harvest was back from 28.3mt to 25.3mt. The AHDB suggest that total grain exports from there might be back over 20% from last year’s 57mt level.

Maize prices

While maize prices weakened in recent weeks from their highs, it would seem that they are still not ready to drift back to previous lows.

The overall global supply situation remains low and demand is strong. March contract prices have risen to $4.40/bushel and the December ’21 equivalent is $4.19/bu, leaving nearby positions up $1.0/bu and December ’21 positions up $0.80/bu since last July.

Chicago maize prices were largely flat for much of December but USDA news of US exports being higher than anticipated kicked prices on again.

Fears remain as to the consequence of dryness on production in south America. US exports last week were put at 1.924mt by the USDA, well above market expectations.

Native prices

While futures continue to bounce about a little, native prices seem firmer as the year ends. Traded volumes are low but offers from buyers are higher this week for those who are in the market.

Nearby wheat is in the €222 to €225/t range and barley is put in the €195 to €198/t bracket. November wheat is around €194-€195/t but barley still has difficulty edging above €180/t.