Grain Trends: prices up as supply concerns increase

Prices improved this week, as signs in the market pointed to a possible reduction in supply.

The Matif wheat price closed at €244.75/t on Tuesday evening 13 June. That was an increase of €5/t on last Friday’s (9 June) close and that price had increased by €10/t over the week.

Coceral, an association for EU grain production, has reduced the forecast for the European Union and the United Kingdom’s grain production.

On Monday, it forecast grain production in the EU27 and the UK at 297.5 million tonnes (Mt), that’s down from 303.5Mt in March.

Dryness was the main reason, as it is affecting crops, particularly in northern Europe, Germany and Spain.

On Friday, the United States Department of Agriculture released its World Agricultural Supply and Demand Estimates (WASDE) report for June.

The report signalled an outlook for global wheat of larger supplies, higher consumption, increased trade and larger stocks.

Global maize forecast

Global maize production was forecast to increase in the report by 3.8Mt tonnes to 1,513.3Mt.

The percentage of US corn in good or excellent condition declined this week from 64% to 61%, according to the US crop progress report. Drought is affecting the crop.

The burst dam in Ukraine last week was in Kherson, an area reported to have some very fertile land.

The renewal of the Black Sea grain initiative is also in doubt and these tensions are most likely playing into the market, according to reports.

Dryness in Europe and increased soya bean prices are most likely playing into the oilseed rape market.

On Friday, Matif (French) oilseed rape for November was at €438.50/t, up €26.75/t on the previous week.

On Tuesday evening, that price was at €453/t.

Native prices

This week, Tirlán offered suppliers a green wheat price of €208/t and a green barley price of €197/t for harvest 2023.

This price does not include any potential co-op bonus payments.

Spot barley was reported at around€230/t to 235/t this week and spot wheat was at €245/t to €250/t, but there was little movement in the market.

Prices for barley and wheat in November are at similar levels.

The Boortmalt average harvest price stood at €262.33/t on last week after a big jump in price. The price on 8 June was at €275/t, up €20/t on the previous Wednesday. This brought up the average price.

Suppliers should remember that a €10/t energy charge is to come off that price, so the harvest price is currently at €252.33/t once that charge is taken off.