International grain markets weakened slightly again last week following the World Agricultural Supply and Demand Estimates (WASDE) report. MATIF December wheat closed at €243.75/t last Friday, down from €247 a week earlier. Prices rose again on Tuesday and Wednesday with MATIF getting back up above €251/t. Price sentiment is day specific.

The movement in Chicago wheat was broadly similar and precipitated by the WASDE.

The sentiment in the report hit wheat more than maize, as it trimmed South American production for 2021/22 to levels that had been anticipated.

Maize remained relatively stable and then increased again following further concerns regarding hits on South American production.

Recent crop condition scores from Argentina had disimproved considerably and this added to overall supply concerns.

Markets continue to watch weather developments in South America. This is impacting on the crop to be harvested and, potentially, on this year’s planting and growing seasons.

WASDE report

The increased supply outlook for wheat in WASDE was the main reason for its recent price weakening. A marginal production increase, coupled with higher carryover stock estimates and a reduction in global consumption, were the main drivers.

This is best summed up in the International Grains Council (IGC) estimates, which show global wheat production raised by 4Mt to 781.0Mt and closing stocks up by 2Mt, to 276Mt.

Despite these changes, the IGC indicated that wheat stocks in the major exporting countries are unlikely to see much recovery in 2022/23, which could mean less pressure to find markets.

Meanwhile, the 2022 winter wheat crop in Russia seems to be doing well so far this winter, with good levels of rainfall reported in the main growing areas. This is in stark contrast to this time last year.

Native prices

Local prices appear to be holding broadly similar due to the general tightness in supply. However, it is possible that we could see some weakening in sentiment if buyers appear in the market en masse ahead of fertiliser purchasing.

Buyers are again leaning heavily towards maize for later this year, so this should signal a need for some forward selling.

Nearby wheat remains in the €300 to €305/t band and barley ranges from €296 to €300/t, depending on the day.

New-crop prices appear slightly weaker, with November wheat more in the €242 to €247/t range and barley generally between €232 and €237/t.