By FWi staff

THE Monetary Policy Committee announced a further drop in interest rates this morning (Thursday) of 0.25% bringing the current level to 5.25%.

But this latest drop will only stop sterling from coming down and is unlikely to have any effect on wheat prices, says Gary Sharkey of BDR Agriculture.

Wheat values have fallen over the past couple of days on the back of easier American and French markets, and futures have lost the recovery they made yesterday dropping about 60p this morning.

With a large amount of grain still on farm and slow exports Mr Sharkey expects prices to come down before the end of the season.

He believes growers will bring a large volume onto the market over the next few weeks sending prices lower. “Theres not many farmers who can store two-years of harvest,” he added.

At its weekly export tender today, the EU grains management committee only granted a mere 10,000 tonnes open market wheat export licenses, at a maximum subsidy of Euro 31.95/t (£21.63/t).

With no exports granted last week due to the Easter break and only 300,000 tonnes the week before, the wheat carry-over is moving slowly.

Wheat values fell towards the end of the season in 1998 and with bigger carryover stocks this year the outlook does not look promising for any significant price increases in the near future.