International grain markets took a pounding earlier this week following the release of a US report.

This had been widely expected to reduce US maize production and help prices, but it did the opposite.

It revised production upwards on the back of higher yield estimates.

The response of markets was instant and downwards. MATIF December wheat price dropped to €171.25 on Tuesday night from €180/t at the end of July. Similar dramatic decreases occurred in Chicago.

As well as this, we now see the UK selling surplus barley very aggressively ahead of Brexit.

While many still doubt the magnitude of the US area and yield figures, these numbers will be used by the market in the near-term. And while they may not be the final figures, they will have left a huge impact on market sentiment. Buyers are unwilling to buy as prices fall and maize comes closer to native grains once again.

One possible upside for markets is the evolving political situation in Argentina.

A change of government might see export taxes re-imposed on agricultural exports.

Native prices were heavily impacted by market developments and harvest pressures. Spot prices depend on the urgency of movement, but for those with a little flexibility, barley is around €165/t and wheat around €170/t.

November prices currently look like €170/t and €175/t respectively.