No great expectations for new wheat crop

By FWi staff

DESPITE predictions of a smaller global harvest, there appears little for farmers to look forward to in the new wheat crop.

The Home-Grown Cereals Authority noted in its most recent MI Prospects bulletin that, to have an impact on EU prices, an important wheat-producing country would have to experience a major setback in crop development.

Wheat plantings across Europe are down on last year, but not by as much as originally expected, said Cargills Ian Wallis.

“Good growing conditions across northern Europe have left much of the crop in excellent health, and yield potential currently looks strong. “Any reduction in harvest size is expected to be offset by the large carry-over stocks,” he added.

In the UK, the strength of the Pound continues to prevent any real price increase. But the HGCA believes that any recovery can only come from a change in overall world supply and demand.

The International Grains Council predicted that global wheat stocks will fall to levels seen since 1980 last month.

But the majority of these stocks will still be held by the major exporting regions, primarily North America and Europe, said Mr Wallis. “As a result the competition for export markets will be fierce.”

Mr Wallis believes that although a price increase cannot be ruled out towards the end of the next marketing year the first half of the season is likely to see values remain under pressure.

“Producers who need to move stocks pre-Christmas should consider hedging at least some tonnage through forward sales,” he advised.

Last week, feed wheat for November movement fetched between £75-£78/t.