EX-FARM WHEAT values are unlikely to improve this season, unless stocks prove smaller than the market has allowed.

Domestic demand is flat and European markets are well-supplied, keeping ex-farm prices between £60 and £65/t.

But traders say wheat values could jump as much as £15/t if the 1.8m tonne old crop carry-out and remaining 200,000t exportable surplus.

Glencore Grain’s James Maw said: “At the moment it’s difficult to judge if there will be enough grain in hand to meet demand until new crop wheat starts to arrive in early August.

“If the carry-out tonnage is tight, it doesn’t allow for any delay in the harvest.”

Mr Maw estimated 500,000-750,000t of wheat were still in store or on farm, about 5% of this season’s 15m tonne production.

“It’s in the hands of the farmers and the co-ops. Consumers still need some top-up supplies for June and July, so if supplies are tight, it could cause a volatile period in July.

“If we have to start importing it could add £15/t to wheat values,” he said.

Anthony Whitaker, shipping trader at Frontier Grain, said the short-term outlook for domestic wheat prices was not good.

“It’s likely we’ll see increasing intervention offers in the next few weeks. Until Apr 17, 7.5m tonnes of feed wheat were offered into intervention stores.

“A recovery in values is certainly possible at the end of the season, but given the supply and demand balance at the moment, it doesn’t look particularly likely.”

New crop prospects were also in doubt, he added. “May 2006 feed wheat futures are worth £71.50.

“But Europe will have very heavy intervention stocks at the end of the summer and there is the potential for that to increase next season as well.”