International grain markets remained weak over the past week, but news of lower US maize acres helped both maize and wheat price sentiment in the early part of this week.

Higher crop forecasts continue to put pressure on prices. While the EU Commission cut EU-27 wheat production by a further 4.3mt (to 117.2mt), the International Grains Council forecast world wheat production for 2020/21 at 768mt. This is up 2mt from its previous estimate and up 6mt on the 762mt production in 2019/20. The main swings are happening in China and Australia, where increased production will more than offset the lower EU production.

Price sentiment is now under the influence of harvest pressure, with harvesting already under way in most northern hemisphere continents.

Rumours continue about the threat of export quotas from Russia starting early next year. If this happens, it is likely that exporters there may try to push out a lot of grain from harvest to the end of this year, which would further pressure prices.

Focus on US

Maize remains a dominant force in grain markets. US farmers had been predicted to plant 97 million acres (m ac) of maize this year, according to the March report on Prospective Plantings. However, the acreage report published earlier this week puts the planted maize area at 92.009m ac for 2020; 5m ac lower than had been forecast but still up on the 89.7m ac grown in 2019.

US maize has been a dominant element of market sentiment in recent months

The lower maize area appears to have swung to soya.

US maize has been a dominant element of market sentiment in recent months as overall consumption was hit from many angles by the COVID pandemic. However, news from there is improving, with demand for bioethanol picking up again and overall demand for feed is also improving.

Rape weaker

Futures MATIF oilseed rape prices finished €6/t lower last week at €374.25/t. This was on the back of a general weakening in the oilseeds complex, partially driven by reduced palm oil processing in Malaysia against fears of further coronavirus concerns.

The EU consultancy company, Stratégie Grains, has again lowered its forecast for the 2020 EU + UK rape crop. It now estimates this at 16.54mt.

Native prices

Native prices remain similar to last week, but there a somewhat firmer tone to the market. Nearby wheat remains around €198 to €200/t, with barley between €165 and €170/t. November prices remain around €188 to €190/t for wheat and €170/t for barley. Earlier this week, Glanbia offered €154/t for green wheat and €135/t for green barley.