While futures wheat prices on MATIF showed slight but continuous improvement over the past six weeks, the nearby spot/cash/physical market prices have been largely static. Various things continue to influence world markets, but the situation remains flat for physical markets, except for currency.
Over the last while, the gap between physical (the price the seller can actually achieve for physical product) and futures prices has been increasing, with physical prices being lower.
Weather continues to impact on the market. The HGCA reports that dry weather in September reduced yield potential in Australia, but rain is now threatening to impact on its quality. This could cause part of the crop to be downgraded from milling to feed wheat.
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Dryness is reported to be causing problems for winter-planted wheat in some regions. HGCA reports that US wheat has had a difficult start due to drier than expected conditions in key growing regions. Problems are also suggested in Ukraine where reports suggest that harvest output could be down by onethird in 2016 due to autumn drought and poor crop conditions going into winter. And it is estimated that about 14% of the intended plantings did not occur.
The EU is not immune either, with eastern states like Poland reporting winter crop concerns due to dryness.
Native prices remain broadly similar, with spot wheat and barley still in the €170 to €173/t range and barley around €160 to €163/t. Forward prices for May are stronger at €178 to €180/t for wheat and €10 under for barley. Prices for November 2016 are up slightly with €183 to €185/t talked about for wheat and €173 to €175/t for barley.
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While futures wheat prices on MATIF showed slight but continuous improvement over the past six weeks, the nearby spot/cash/physical market prices have been largely static. Various things continue to influence world markets, but the situation remains flat for physical markets, except for currency.
Over the last while, the gap between physical (the price the seller can actually achieve for physical product) and futures prices has been increasing, with physical prices being lower.
Weather continues to impact on the market. The HGCA reports that dry weather in September reduced yield potential in Australia, but rain is now threatening to impact on its quality. This could cause part of the crop to be downgraded from milling to feed wheat.
Dryness is reported to be causing problems for winter-planted wheat in some regions. HGCA reports that US wheat has had a difficult start due to drier than expected conditions in key growing regions. Problems are also suggested in Ukraine where reports suggest that harvest output could be down by onethird in 2016 due to autumn drought and poor crop conditions going into winter. And it is estimated that about 14% of the intended plantings did not occur.
The EU is not immune either, with eastern states like Poland reporting winter crop concerns due to dryness.
Native prices remain broadly similar, with spot wheat and barley still in the €170 to €173/t range and barley around €160 to €163/t. Forward prices for May are stronger at €178 to €180/t for wheat and €10 under for barley. Prices for November 2016 are up slightly with €183 to €185/t talked about for wheat and €173 to €175/t for barley.
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