Different spells of intense heat and dryness appear to have impacted on wheat production across parts of Europe and may have an even bigger impact on maize.
A number of different heatwaves in Europe at different times appear to have affected wheat production, especially in central Europe.
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International grain markets continue to be pressured by the weight of supply but this pressure may be waning somewhat. The most recent global forecast from the International Grains Council has total production at 2,148Mt, down 8Mt from its previous estimate at the end of June.
The bulk of the reduction comes from the wheat estimate, with challenging crop conditions in the EU, Russia and Canada cited for the decrease. Very high temperatures are the main issue in the EU and Russia but this may have an even bigger impact on maize than on wheat or barley.
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That said, wheat exports from Russia have been reduced to 31.4Mt by consultancy SovEcon, down 6.2Mt on the previous estimate. And high internal prices are slowing availability for export but this may not continue. While wheat production is forecast to be lower, global production estimates remain at a record level of 763Mt (761Mt in 2017).
Uncertainty over maize production still dominates the market. Weather conditions are now better for growth in the US and this is helping crops there. However, the planted area remains unknown and yields will be uncertain for some time to come.
Native prices are now largely based on new crop, with November wheat holding in the €182 to €185/t range with barley around €175/t. Further out, May 2020 is currently seeing wheat at €190/t and barley at €180/t.
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International grain markets continue to be pressured by the weight of supply but this pressure may be waning somewhat. The most recent global forecast from the International Grains Council has total production at 2,148Mt, down 8Mt from its previous estimate at the end of June.
The bulk of the reduction comes from the wheat estimate, with challenging crop conditions in the EU, Russia and Canada cited for the decrease. Very high temperatures are the main issue in the EU and Russia but this may have an even bigger impact on maize than on wheat or barley.
That said, wheat exports from Russia have been reduced to 31.4Mt by consultancy SovEcon, down 6.2Mt on the previous estimate. And high internal prices are slowing availability for export but this may not continue. While wheat production is forecast to be lower, global production estimates remain at a record level of 763Mt (761Mt in 2017).
Uncertainty over maize production still dominates the market. Weather conditions are now better for growth in the US and this is helping crops there. However, the planted area remains unknown and yields will be uncertain for some time to come.
Native prices are now largely based on new crop, with November wheat holding in the €182 to €185/t range with barley around €175/t. Further out, May 2020 is currently seeing wheat at €190/t and barley at €180/t.
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