Grain markets firmed over the past week, with the help of strengthening futures. Weather concerns, plus short covering by fund managers, tend to be the major drivers. The other big uncertainty is the release of the 2016 planting intentions by US growers – will they opt to plant maize or soya?
Markets continue to be somewhat nervous with regard to weather, especially for wheat. Reports of possible frost damage and drought add to uncertainty about future production and price.
The recent HGCA grain report indicates that China is to change its policy with regard to maize stocks and support. The changes could see internal prices there drop to imported levels, thus giving rise to uncertainty over demand for imports and the level of internal production.
Meanwhile, native prices have strengthened somewhat, for the moment. Spot wheat has ranged between €153 and €158/t, depending on the hour and the day. Spot barley is tending more in the €144 to €146/t range. At this point, there is little or nothing in the way of a premium or carry for May sales.
Prices for November have benefited more from the recent activity, with wheat in the €164 to €165/t range and barley about €10/t lower.
The big question for growers now is will factors that threaten production continue or get worse, or will we still get high yields with increased price pressure? Planting decisions become increasingly important.
SHARING OPTIONS