September 10, 2010

Export demand leads to further increase in UK grain prices

Wheat prices have continued to rise since the past week, with London wheat futures at GBP162.80/tonne (US$250.7) for November on Tuesday (Sep 7).

Ongoing export demand and concerns over the US corn crop were behind the continued bullish run, said traders. Although Russia had apparently revoked any plans to import wheat, Prime Minister Vladimir Putin said he would extend the export ban until after next year's harvest, potentially further boosting demand for UK wheat.

UK feed wheat was worth about GBP152/tonne (US$234) ex-farm for September, with Group 1 milling wheat pegged at GBP183/tonne (US$282), depending on location. HGCA corn returns data showed that farmers were taking advantage of higher prices, selling 42% more feed wheat in August, for delivery before November, when compared to last year.