Grain prices reached new contract highs on Tuesday (21 August), buoyed by stronger US markets and lower Black Sea supplies.
London wheat futures hit £206.50/t for November - £11.50 up on the previous week. Paris rapeseed futures also tracked up towards contract highs, at €519.25/t (£410/t) - €12/t higher, week-on-week.
The renewed bullish run was sparked by the first crop tours in the USA, which had confirmed the poor state of maize and soya crops following prolonged drought. By 19 August, 4% of the maize crop had been harvested - one of the most advanced harvests on record. Only 23% of the crop was rated good to excellent, 34 points below last year, with many fields likely to be turned into silage instead of harvested for grain. More than 90% of the soya had reached pod set, and 31% was rated good to excellent against 59% last year.
"Despite rising prices, the critical situation has led importing countries to purchase," said a report by analyst Agritel. "This year, the lower grains supply in the Black Sea region should shift the demand towards European origin. The European export activity will thus be closely watched in the coming weeks."