Feed millers swing to cheaper wheat
High corn prices are set to prompt animal feed manufacturers to use more wheat, it has been suggested.
Jonathan Bouchet from OTCex Group, a Paris-based brokerage, told Bloomberg that corn has now reached its highest per-bushel price in two years.
However, this is in turn is pushing the value of wheat up, with stockpiles dwindling and prices having risen 4.5% in the last three months, although it is expected that wheat will still be better value than corn.
"The whole grain market is related through animal feed because producers tend to switch from corn to wheat. Right now wheat is supported by the corn story," Bouchet told Bloomberg.
It was also reported this week by The Financial Times that an export ban in Russia will put further pressure on cereals stock.
This in turn is expected to mean that animal feed manufacturers will be facing high prices for cereals for some time yet.
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