Cereal values set to level out at more than £100/t

Cereal prices are unlikely to ever return to the low levels seen just two years ago, after what the EU Commission agrees has been a “step change” in the market.

According to senior commission analysts, values of about 90/t (£64/t) are a thing of the past. Briefing the Eurofarm Group of leading EU farming magazines in Brussels last week, they suggested values were more likely to settle at the 150-160/t (£107-114/t) mark in two or three years’ time, compared with this season’s 210-240/t (£150-170/t).

Increased plantings would see some softening of prices next year. But, overall, the development of the biofuels sector, climate change and growing demand for meat in developing countries, would provide long-term support to the market.

One civil servant went on to suggest that, with prices at these levels, it would be easier to secure an agreement on the CAP heath check. “It’s aways easier to reform when prices are higher,” he said.

Q The EU Commission will propose a 2% increase in milk quotas for 2008/09, when it tables its report on the state of the EU dairy market next month. This will be on top of the 0.5% increase planned as part of the 2003 CAP reform.

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It takes just a couple of minutes to create a listing on Farmers Weekly Graindex and you’ll get a range of prices to compare from active buyers who want your grain.
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