UK grain prices rose again in the week to Wednesday, with sterling continuing to slide against the euro and further downgrades to the size of crops in other important grain-producing EU states.
Ex-farm spot feed wheat values ranged from £118-£125/t, with the average rising by £4.60 on the week to £120.20/t. Feed barley rose slightly less to average £100.80/t.
With an oversupply of milling wheat in some areas, premiums are coming under more pressure as millers hang back. This has taken the spot premium for full-spec breadmaking wheat in the South East down to just £7/t, compared with an average premium of £15/t.
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The size of the German wheat crop was downgraded again this week, this time by the German farm co-operatives’ association, to 24.2m tonnes, compared with 26.5m tonnes last year and almost 28m tonnes in 2014.
A US Department of Agriculture report released late on Friday (12 August) predicted a 9m-tonne drop in EU wheat production to 147.5m tonnes.
However, this would be more than offset by increases for other major exporters, pointed out AHDB senior analyst Helen Plant.
Russia is a particularly aggressive competitor for export business at present, shipping more than 720,000t just last week and expecting a record wheat crop of 69.5m tonnes. It is set to become the world’s top wheat exporter
The US wheat crop is expected to rise to 63.2m tonnes, compared with 55.8m tonnes last year. This would be its largest crop since 2008-09.