October 8, 2008

International grain markets have been hit by the spreading global financial crisis.

Chicago wheat futures fell US$40, soymeal US$31 and rapeseed US$35 overnight.

Investors liquidating their grain assets, a decline in fuel demand and a large northern hemisphere rapeseed crop are pressurising rapeseed prices, according to Juliet McDonald, grains market analyst from Grainpool.

Canada's rapeseed crop is about 12 million tonnes, up 1.4 million on-year, while the Ukrainian rapeseed crop stands at 3 million tonnes, said McDonald.

Farmers and analysts expect the crisis to make it harder for new players to enter the wheat export market this harvest.

Ron Storey from the Australian Crop Forecasters, said the wheat crop will reach 20-22 million tonnes, but that farmers should be careful on how they give their grain to from a payment security point of view.