Grain markets looked more positive this week, as they recovered from the severe drop of last week.
The December French wheat price dropped to a low of €249.50/t on Thursday 23 March, but things started to look more positive on Friday when the price closed €10/t higher than the day before.
On Tuesday evening of this week, that price had risen further to €264.75/t. At the time of going to print, it was at €267.25/t.
The increase on Friday most likely came from reports that Russia wants to ensure prices are high enough to cover the average cost of production.
Cheap Russian exports have been pressuring global wheat markets in recent times.
The future of the Black Sea grain corridor is also affecting grain markets, as it is unclear how long that arrangement will continue for.
It was agreed to be at least 60 days when it was extended ahead of the 19 March deadline.
Other factors at play are dry weather in the US and the state of Kansas in particular, as well as funds selling off investments.
Volatility is likely to remain in markets, with these factors all having an impact and the Agriculture and Horticulture Development Board (AHDB) remains negative on wheat, barley, maize, oilseeds and soya for the next six months.
Brazil is currently harvesting a record crop of soya beans. Harvest is reported to be just over 70% complete and soya prices are declining as a result.
The EU oilseed rape crops look good and Australia’s crop is also pressuring markets.
However, oilseed rape prices did pick up this week.
Friday’s French price for November closed at €463/t and on Wednesday afternoon, it was at €471.75/t.
The AHDB reported these prices were supported by an increase in crude oil prices.
Vegetable oil prices have been declining recently and this is also playing into the oilseed rape price.
The AHDB stated that rape oil prices have led the pressure in vegetable oil markets and dropped below palm oil prices earlier this month.
The FOB Creil spot price for malting barley dropped by €20/t last week to €275/t, but has since recovered and was at €287/t on Wednesday afternoon.
At home, the improvement on global markets has fed into native prices. Spot prices for barley and wheat are both back up by about €5/t. The differential between them remains wide at approximately €15/t for spot and €20/t for November prices.