Weather concerns drove grain prices up firmly on Friday (18 May) with the London November 2012 feed wheat futures contract closing £4.25/t higher on the day at £158.05/t while January 2013 gained £5.35/t to £160.50/t.
This represents a gain of more than £10/t on some contracts from their lowest points on Monday.
Reports that drought has caused irreversible damage to some crops in Russia are contributing to the firmer tone, while a forecast hot, dry wind across some of Russia’s grain producing regions added to the concern. The impact of hot dry weather on parts of the Kansas wheat crop has also had an effect on the market.
This week also saw Analyst Strategie Grains cut 4.2m tonnes off its EU 2012/13 soft wheat production estimate, taking it to 122.7m tonnes.
The extent of winterkill in Germany, France and Poland are behind this move but the figure is significantly below all other trade house estimates and should be treated with caution, said Gleadell’s Jonathan Lane in the company’s weekly grain report.