WHEAT PRICES have taken a dive this week in response to improved weather in France and hearty production estimates for the UK.
There is little market now for old crop cereals, but harvest futures have fallen £2.50/t over the past week alone, ending their mini rally.
Simon Ingle, head of milling wheat at co-op Grainfarmers, said values had slipped £60/t for feed wheat.
The outlook for next June is better, with futures prices around £70/t, though they have also eased by some £2/t over the past 10 days, he said.
“Farmers are still behind their traditional selling patterns and on the eve of harvest, options are beginning to look a little limited.
“They will have to make selling decisions on new crop soon, especially in view of the delay to the single farm payment.
“Short-term, prices will find it difficult to recover, but long-term demand in traditional markets such as Spain and Portugal will create significant opportunities.”
Wetter, colder weather in France has come in time to boost yield prospects, depressing values by €4/t, Grainfarmers said, while UK prospects also looked good.
Home Grown Cereal Authority plantings estimates put the UK wheat area down 3% at 1.93m ha (4.8m acres)
On the back of that, Grainfarmers is forecasting a UK wheat crop of 15.5m tonnes and carry out of around 3m tonnes.
“That’s quite high compared to recent years,” said Mr Ingle. “The majority of the surplus is feed wheat so the number of outlets is limited.”