The past week saw international grain prices remain relatively flat, despite some ups and downs. With the December ’21 contract now gone from the MATIF trading screens, the focus is on December ’22.

That said, the nearby contracts for March and May continued in the €282 to €285/t range, which are close to where the December contract was.

These positions were weakening again as we went to press on Wednesday.

Wheat price movements

Most markets dipped at the end of last week in anticipation of the world agricultural supply and demand estimates (WASDE) report from the USDA. The report increased overall wheat stocks due to higher production and futures markets did weaken somewhat.

However, that dip was shortlived, as prices rebounded again on Friday. This was thought to be a result of China’s unexpected return to the feed grains market.

The WASDE report indicated higher overall wheat production, with revised estimates for Australia (+2.5Mt), Russia (+1.0Mt) and Canada (+0.65Mt) and it increased global wheat ending stocks by 2.4Mt to 278.2Mt.

Market information sources indicated that China has purchased “large volumes” of French, Ukrainian and Australian feed grains (wheat, barley and maize). They may have been availing of the comparatively low prices, but the move seems counter to reports of very high internal maize production and profitability challenges in its pig herd.

South America

Meanwhile, market commentators continue to watch all aspects of South American weather. The potential impact of La Niña continues to be monitored, with dry weather continuing to cause concerns for the current maize crop.

A big crop from this region is needed to ease global maize supply pressures for 2022 and if this does not happen, overall supply will continue to be tight.

Continuing dry conditions could also result in the second maize crop being planted into dry conditions in early 2022, which could affect planting, establishment and performance.

Native prices

There is little to indicate any weakening in physical prices. Nearby wheat continues in the €305 to €310/t range, with barley still around €300 to €305/t.

New-crop November prices remain broadly similar to last week, or up slightly following the improvement in futures prices. Wheat tends to be in the upper half of last week’s price range at between €245 and €250/t and barley at €235 to €240/t.