Futures prices rose by more than £10/t today to £168/t delivered for London November feed wheat when the US Department of Agriculture monthly forecasts showed world grain production lower and consumption higher than its September estimates.
The biggest change to the US predictions came in the maize crop, which the USDA now thinks will be 321m tonnes, 13m tonnes lower than it did just a month ago, when in turn it was reduced by 5m tonnes on lower yield estimates. A further assessment of yield is due later today (8 October).
While the drop is not huge in world production terms, supply and demand of maize is now so finely balanced that a nervous market will move on any news, say traders.
World wheat production is forecast at 641m tonnes, down 1.5m tonnes compared with September figures, while the estimate for coarse grains, which includes maize and barley, falls by 9m tonnes to 1,089m tonnes.
The latest figures estimate world wheat stocks by the end of the current season at 174.7m tonnes, 3m tonnes lower than the previous forecast and compared with 196.5m tonnes at the end of last season.