HGCA: Prices firm on spot demand


  • Delivered wheat prices robust on spot demand

    Wheat prices have held firm recently on robust spot demand and limited farm supply, further complicated by foot-and-mouth disease restricting supplies in some areas.

    Last week demand remained robust, particularly in the south-west, where prices
    were 1-3 higher.

    LIFFE old crop wheat ended 60p higher, despite being as much as 2 higher on Wednesday (18 April).

    New crop prices were mostly around 70p higher.

    Forward prices suggest lower wheat use for feed
    Higher wheat prices and lower barley prices have seen barley move to as much as a 7 discount on November LIFFE futures.

    At the beginning of March, both grains were similarly priced. The discount on delivered markets has been higher, particularly in Scotland, suggesting barley usage at current prices could rise in feed rations.

    Meanwhile new crop French maize prices are attractive in Northern Ireland
    compared with British wheat.


  • MANCOM rejects all open market bids

    The EU rejected all bids to export free market wheat last week, including some bids at zero.

    It simultaneously raised the French intervention wheat tender for resale onto the
    domestic market by 250,000 tonnes to 1m and extended the period of resale for Belgian intervention wheat to 26 June.

  • French wheat prices strong in recent weeks
    MATIF May wheat futures have risen around E4/t in the last month, leaving it around E3 above intervention.

    World prices are unchanged on the same period, and the Euro remains at 89 US cents.

    Some continental traders note that French export demand has benefited from the recent high prices in the UK, with shippers selling UK wheat back and buying French instead. See www.matif.fr, www.onic.fr and www.ecb.int

  • CBOT maize prices sharply lower, wheat holds close to unchanged

    Maize prices ended the week nearly $4 lower as early concerns over planting delays faded and the weather outlook improved for further plantings.

    Meanwhile, wheat futures managed to stay close to unchanged. Wheat values were helped by slow spring plantings and concern that higher areas of winter wheat could be abandoned. See www.cbot.com

  • Surprise US interest rate cut
    The US Federal Reserve cut interest rates for the fourth time in 4 months by
    0.5% to 4.5% on Wednesday (18 April).

    Official US interest rates fell below the euro-zones benchmark ECB rate by 0.25% for the first time since the euros launch.

    The move brought the Euro close to the years lows of 87 US cents, before it recovered 2 cents to close to 90 cents by Friday (20 April).

    See www.federalreserve.gov

  • Euro1 = 62.36p, 1 = Euro1.603 on 24 April


    Taken from HGCA weekly MI Bulletin
    To contact the HGCA phone 020 7520 3972

    Click here to visit the Home-Grown Cereals Authority

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