8 March 2002

Grain marketing is top of agenda

By Olivia Cooper

GRAIN marketing problems in the UK will be at the top of the agenda when NFU members and officials meet John Bensted-Smith, head of cereals at the European Commission, next week.

Topics for discussion include new-crop market management plans, import levy calculations, CAP review, EU enlargement, modulation and agrimonetary compensation.

"The commission exerts quite a degree of management on the internal market," says NFUs Paul Ibbott. Recent actions include abolishing the k10/t import levy on eastern European grain in October 2001, and refusing to grant export refunds in an attempt to keep EU prices low.

Mr Ibbott also claims intervention is no longer being used as a safety net, but as a guide price, and will be looking for justification of the commissions decisions.

Meanwhile, UK wheat prices have continued to slide, losing another £2/t in the past week, to £66-£68/t ex-farm. Poor demand, French prices close to intervention levels, and a slow export pace are to blame, says Grainfarmers wheat director, Gary Sharkey.

"The only hope for UK farmers is a drop in the £ or a drought in the US or Ukraine – which can lose 60% of its yield in April to June." US winter wheat is reportedly looking poor as it emerges from dormancy and prospects of a 10% export tax in Argentina have lifted US prices off contract lows. "There can still be a sting in the tail at the end of the season, but there is always the danger that old and new crop values will converge," says Mr Sharkey.

New crop prices have stabilised in the past week, as consumers are buying but few farmers are selling, leaving merchants somewhat short, he adds. Feed wheat is worth about £55/t ex-farm for harvest and £60/t for November. &#42