Grain prices gained again last week as largely positive market pressures continue. MATIF December wheat closed last Friday at €210.75/t (up €0.75/t on the previous week) and it closed on Tuesday of this week at €212.75/t. December ’21 prices were up slightly also but they remain considerably lower than today (€194/t vs €210/€212/t) and price adjustment will have to happen between now and harvest to bring these into line.

Prices in Chicago increased also, mainly since last weekend, with wheat closing on Tuesday at €189.25/t and maize at €141.24/t.

Weather and demand continue to be the main price drivers. We hear weekly about the potential impact of dryness in the wheat growing regions of the US and around the Black Sea. We also hear of dryness issues affecting harvest output in south America and its impact on the planting season there.

Maize production lowered

Last week the AHDB reported a further decrease in maize production estimates from Argentina, which is now put at 44.5mt.

This production number was put at 54.3mt in last month’s International Grains Council report so it will be interesting to see the revised numbers for this, and other south American countries, in its November report ,which is due out this week.

While there was recent rain in some parts of that country, it is thought to be insufficient to benefit crops in the areas that need it most.

And it is thought that the strengthening La Niña weather system is likely to continue to reduce the likelihood of rain across the region.

Demand for grains in China continues to be very strong and analysts suggest that this will be even higher than historic levels, prior to when imports were ceased and when a portion of their pigs were culled due to African swine fever.

This additional level of demand is helping all cereals and the AHDB report indicated that France is likely to send around two million tonnes of wheat there in this marketing year.

Native prices

Nearby native prices are up somewhat on the back of stronger demand sentiment, but price still depends on location and payment date.

Nearby wheat is trading either side of €220/t into the new year, but it is not really much higher for May sales. Wheat for next November ’21 is currently put at around €195 to €197/t.

Nearby barley is in the €190 to €193/t bracket, with €195 to €198/t possible for May. November ’21 barley is currently put at €182/t to €184/t.

The uncertain impact of COVID-19 on the demand for malting barley continues to weigh on overall barley price sentiment.