News

August 05, 2008

A Super Harvest Takes Prices Tumbling

By Sally White

Harvest has started, but traders say it is too early to predict what the markets will be prepared to pay UK farmers for their grain. Prices have been tumbling as it is becoming apparent that UK plantings are greater than expected, Europe’s yields are looking good and funds have been bailing out of commodities generally. David Sheppard, CEO of UK traders Gleadell Agriculture, said: "The Home Grown Cereals Authority estimates that plantings in the UK are higher than predicted, with wheat up by 14 per cent to over two million hectares and barley rising by 12 per cent to 981,000 hectares.”

Grain merchants are being reported admitting that volatility in the market made them nervous and reluctant to be the first to quote prices for this year.  Wheat prices have dropped by about £5 a ton over the last few days, knocked back by promising yields across Europe and aggressive exporting from Black Sea countries. Ex-farm values for harvest movement weakened to about £115 a ton, depending on the region, with no premium available for early-cut crops. "There is a lot of old crop being...