Lower wheat crop estimates push price higher

Official reports of lower French and English wheat yields played their part in another mid-week rise in UK grain prices.

London November feed wheat futures were at £164/t delivered on Wednesday (Sept 15) after the NFU put the total English wheat crop at 13.5m tonnes from an area about 6% higher than the previous year.

This first wheat forecast of the year is based on a member survey and puts the crop almost 400,000t down on the five year average of 13.9m tonnes.

French total wheat production is estimated at 35.6m tonnes, a 2.7% drop on the year, by FranceAgriMer. Quality is higher than in 2009, with average specific weight at 78.8kg/hl and while France’s wheat exports are expected to rise to a record 11m tonnes, wheat imports into France will more than double to 1.2m tonnes this year. Stocks of wheat, barley and maize will all be lower at the end of this season than last.

Other factors helping the market to continue firming include the release of a lower USDA world wheat production estimate at 643m tonnes last week, the fourth consecutive cut in as many months.

Speculation continues about 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 would 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.

• Latest figures for the 2010/11 Australian harvest put its wheat crop up 13% to 25.1m tonnes, which will allow it to gain export trade on the back of Russia’s export ban.