January 22, 2014

EU compound feed producers switch to corn

Compound animal feed producers in the EU are currently switching to corn as a cheaper alternative for supplies instead of wheat, according to Germany's leading grain trader, Toepfer International.

Toepfer also added that demand for deliveries from March 2014 is good.

EU corn is currently quoted well below wheat. March corn on the benchmark of the Paris Euronext market was at €171.75 (US$232)/tonne on January 13, well below March wheat at €190.75 (US$258)/tonne.

Despite strong export demand, especially from Egypt and Morocco, Paris wheat prices have fallen in January, Toepfer said. Despite this weakness in Paris, EU wheat has lost some of its competitiveness in the Middle East Gulf and South African markets.

Due to a lack of new EU export sales, EU feed barley prices have fallen partly, Toepfer added. At current price levels, EU feed barley is not competitive in export markets against competitor origins in the southern hemisphere.