International wheat prices appear to be ending the year on a downward note as prices in all markets weakened earlier this week. And this was after an initial pick-up in sentiment as nervousness relating to the omicron COVID-19 variant appeared to be subsiding.

It would appear that the main driver was in feed markets following confirmation that production continues upwards in both Australia and Argentina. The biggest decreases occurred for nearby positions in both wheat and maize but all positions weakened.

MATIF wheat for December 2022 closed last week at €257.75/t, went up to almost €259/t on Tuesday but weakened then to close on Tuesday at €252.75/t. This type of movement has been common in all markets and is likely to be at least partially driven by technical adjustments as we approach year end.

Looking back at 2021

This was an extraordinary year in market terms. For the first three months spot native wheat ran pretty much at the same level as imported maize ex-port. Maize was tight globally and wheat supply was tight in Europe.

During this time barley was trading substantially below wheat due to the perceived excess in Europe. Basically, it had to be much cheaper than imported maize if it was to buy market share.

From the end of April, imported maize began to fluctuate either side of €280/t having been at or below €250/t for the first three months or so. This put maize at a much higher price than wheat and barley and effectively made new imports uncompetitive.

This resulted in a demand and usage surge for native grains in the second quarter, which pulled up barley price.

Barley increased to parity with wheat by the end of June but then the European harvest was under way and cheaper imports brought harvest price pressure.

From harvest onwards

However, the wheat harvest came and went with very little evidence of price pressure. This allowed barley price to come back up to within €10/t of wheat and maize price increased further to sit either side of €290/t from mid-August.

The overall availability concerns around maize caused wheat and barley prices to increase from early October. However, Irish green grain prices had been set by then.

Overall demand and availability issues pulled wheat and barley prices back up above imported maize, with both grains exceeding €300/t and minimal price difference between the two grains.

Shipping cost and availability was a factor here too.

Native grain prices have eased back slightly in recent weeks but they are still holding strong at above €300/t.