Firmer wheat on lower USDA world estimate

A slightly lower forecast in world wheat production firmed the markets again today (Friday, 10 September) and pushed the London November feed wheat futures price back up to £162/t.

This puts the spot feed wheat price back up to about £148-152/t ex-farm depending on region. The November 2011 ex-farm price is about £125/t.

The lower USDA world wheat production estimate at 643m tonnes represents the fourth consecutive cut in as many months. However, the figure for Canada was raised by 2m tonnes after a better out-turn than many had expected in the light of crop problems there earlier this year.

Speculation continues as to how long Russia’s grain ban will remain in place and about the quality and reliability of its grain stocks from previous harvests. The grain trade had become as sensitive to news and rumour as the equity markets, said Fengrain marketing director John Whitelam.

While uncertainty may continue over the Russian situation, more should be known about the quality of our harvest in the next couple of weeks. UK millers and processors would then be able to be adjust their specifications accordingly and some of the confusion could then be unpicked, he said.