Grain Market Update

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Grain Market Update
22 Mar 2016

Grain Market Update

Grain
  1. Grain markets remain difficult

Grain markets remain difficult with investor sentiment continuing negative towards grain and oilseeds. Latest crop reports from Europe suggest that crops have overwintered well with little reports of frost kill. However, crops in Portugal and Spain are beginning to suffer from increasing soil moisture deficit. Heavy rains across UK, Ireland, Northern Italy, Slovenia and Croatia has resulted in some crop damage. Meanwhile, crops across Eastern Europe including Belarus and the Ukraine are advanced having come through an unusually mild winter. Fears of frost damage are receding as the spring moves on. A recent cold snap in the US has impacted on the winter wheat crop and this has seen some risk premium built back into grain futures over the last few days. The prospect of high carryover stocks coming into the new crop year along with weak energy and commodity prices is limiting prospects of a price rise in the medium term.

Avg Temp

 

  1. Dried grain prices

Grain markets for old and new crop remain flat. Compound feed mills are buying on a hand to mouth basis in an expectation that market prices could potentially move lower. Spot dried barley is trading from €145/t to €147/t with wheat trading €10t to €12/t over barley. Maize has traded in a narrow band in recent months with prices ranging from €166/t to €168/t over an 18 month window. New crop dried barley for Oct / Nov collection is trading from €150 /t to €153/t with wheat from €160/t to €164/t. New crop maize prices are limiting any prospect of a price lift trading flat at €167/t.

  1. Irish sowing estimates 
Table 1. Cereal sowing estimates (ha)              2015 vs 2016
  2015 2016 % Change on 2015
Wheat 63,500 67,500 6.3
W Barley 68,000 73,000 7.4
W Oats 9,000 8,000 -11.1
S Wheat 9,500 6,500 -31.6
S Barley 128,000 114,000 -10.9
S Oats 13,000 13,000 0.0
Total area 291,000 282,000 -3.1

 

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