The recent speedy increase of grain prices, and corn prices in particular, seems to have stopped. However, grain is still quite expensive.
Thanks to moderate yields and strong demand, the market is still steady. Corn prices will not continue to rise, but will remain at a high level due to ongoing concerns about droughts in South America and high demand worldwide.
Corn exports from the US were already significant and are continuing well. So far, two thirds more has been exported than last season. On the Paris futures market, there is no further progression from the recently increased price of the first-expiring contract.
China remains the main driving force behind the solid price levels on the grain market. Market agency Agritel, for example, can report that China has now brought an amount of 670,000 tons of wheat from the state reserves into the domestic market.
Wheat prices also remain virtually stable on the Paris futures market. Trade on the physical market is smooth, and Egypt bought another batch of grain in Russia. Russia’s wheat exports are currently strong in anticipation of export quotas to take effect in 2021. After a period of very disappointing export figures, the US also exported a lot of wheat in the past week, which provided good support for the wheat price in the Chicago futures market last Friday. Activity there, just after the national holiday of Thanksgiving, was further limited.
Barley prices are slowly but surely climbing worldwide, thanks to high demand for this feed grain. In the EU, France in particular is exporting heavily and beyond Ukraine. That drives prices up there. In Australia, barley prices are under some pressure, but that is the result of the new harvest there, which ensures a wider supply. China is a strong barley market and a lot goes to Asian destinations such as Thailand, North Africa and Turkey.
According to Agritel, the weather in France, unlike this time last year, is developing favourably for the winter crops. These crops look good according to FranceAgrimer, the French agricultural board. Expansion of the acreage is expected and a yield that is more in line with normal averages after the current moderate season.