Old crop grain prices took another hit on Friday 6 May, with the London feed wheat futures market falling £6/t by late afternoon to £197/t for May delivery and £191/t for July.
The possibility of having to deliver physical grain to fulfill May futures contracts recently pushed May prices higher than those for July.
However, drought in Europe and late plantings in North America mean that new crop has more support than old crop. New crop regained some of the ground lost earlier in the week, rallying on Friday 6 May by £2/t to £170/t delivered for November. This was £2/t below its start on Tuesday 3 May.
Volatility has been added this week by another fund advising that the commodity price rise may have run its course, prompting holders of grain and other agricultural futures contracts to sell. Oil prices have also fallen, bringing oilseed rape values down alongside them. Fears for the outlook for the US economy have added to the overall downward pressure.
There was little demand from consumers of new crop grain, who were waiting until there was more certainty about harvest outcome and where the origin of best-priced wheat would be, said Openfield’s David Doyle.