The arrival of rain in key areas of the US midwest caused global grain prices (except for US spring wheat) continued to slide lower last week.

Furthermore, the International Grains Council (IGC) estimates that global grain output will exceed demand for the first time since 2016/17. However, the margin for error is small at just 2.0Mt.

Record US maize crops are predicted to be part of this surplus. Hot, dry weather in the US could push up prices, but without it, prices are likely to drift lower, according to AHDB.

The Brazilian maize crop estimate was cut again by Agroconsult, down 0.9Mt to 90.2Mt. This is far lower than the latest IGC forecast of 95.0Mt, but higher than the estimates of some private forecasters.

Harvesting of the drought-affected second maize crop is under way so we will soon get clarity.

US planted area

There was also pressure from selling by speculative traders ahead of Wednesday night’s (30 June) US planted area and stock reports.

The market is expecting the maize area to be 3% higher than the USDA forecast in March. A smaller than expected number could push prices up. But if it’s as expected or bigger, prices are more likely to come down.

Harvest

The winter barley harvest is under way in France and Russia but thunderstorms are causing delays in France.

As harvests advance, unless results are poorer than expected, we could start to see some harvest pressure on prices as the risk premium comes out.