Market Report: Grain prices improve on back of weak euro

Grain and oilseed markets have improved slightly over the past week, aided by the weaker euro and concerns over the impact of dry weather on new crop growth.

As Farmers Weekly went to press, spot feed wheat was worth about £110/t ex-farm, with new crop futures up by £2.40/t on the week, to £107.40/t for November.

Values have been boosted by the weak euro, which at $1.2178 on Wednesday (19 May) reached its lowest rate against the dollar since April 2006. This has encouraged further export trade from the EU, including a sale of 500,000t to Algeria for June/ July shipment.

Dry weather is continuing to cause concerns across northern Europe, with Strategie Grains‘ latest report cutting soft wheat output by 1.2m tonnes to 133m tonnes. However, better weather in southern Europe is likely to reduce export demand from the UK to its traditional destination Spain, which is expecting a 780,000t larger soft wheat crop in 2010.

Meanwhile, oilseed rape values have improved to about £260/t ex-farm for May and £240/t for harvest. Despite a huge global soya crop in the pipeline, tight old crop rapeseed supplies and slow new crop growth across the EU continued to support domestic markets.