Markets were relatively flat over most of the past week, as the main variables appear to have settled, for the time being at least.

However, physical prices eased back slightly earlier this week. Weather for maize filling plus demand uncertainty driven by fears of recession remain the main background drivers.

Wheat remains volatile in the short term because exports from Ukraine continue to increase in pace. However, markets continue to be supported by rising maize prices due to fears of limited supply level and this may provide a support for all grains.

Global maize

Concern continues for global maize production in the northern hemisphere, as has been the case for the past month or more. Harvesting has already started in France – much earlier than normal and indicative of the concerns and reports from there.

Indeed, the condition of French maize is said to have deteriorated further, according to this week’s AHDB report.

This states that an estimated 45% of the French maize crop was in ‘excellent’ or ‘good’ condition, compared with 91% this time last year – the lowest rating in more than a decade.

A similar situation pertains in the US, with official data suggesting that crop condition is rated below average and continuing to decline, with the proportion of the crop in poor to very poor condition increasing at every assessment.

Traders are now beginning to adjust yield expectations for maize ahead of the USDA’s monthly supply and demand estimates early next week.

Wheat supply

While exports continue from Ukraine, it remains likely that storage will be an issue for its maize crop.

Last week, the Ukrainian Agrarian Council indicated that the area sown to wheat for 2023 could fall by 30% to 40% due to a lack of funds.

It also indicated that wheat yields next year are likely to be relatively low, due mainly to fertiliser cost and reduced usage. The consequence could be that its 2023 wheat harvest would be back to around 15Mt compared to an estimated 19Mt in 2022 and 32.2Mt in 2021.

It is estimated that about 2Mt of agricultural products (grains plus oilseeds) have now been exported. While this is a substantial increase in export capacity, it is a long way short of the 20Mt that were earmarked for export.

Native prices

Local prices have weakened slightly this week on the back of lower import prices. November wheat is back to around €340/t, with barley a tenner lower at €330/t. Imported maize has eased back slightly too, to around €345/t ex-port.