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Weather aids world wheat price recovery

World wheat prices moved upwards last week as global weather events focused the minds of international grain traders on grain supply and demand.

Despite increasing turmoil in financial markets, wheat prices staged a significant recovery, according to Fintan Conway of the IFA grain committee.

November futures prices for milling wheat on the Paris MATIF rose by €20/t last week, from Monday's low of €194.25/t to Friday's price of €215/t.

"Weather events particularly across the northern hemisphere and their potential impact on crop yields have refocused minds on market fundamentals of supply and demand," said Mr Conway.

"European prices have also benefited from a much weaker euro."

In the US, wheat futures rose on the back of forecasts for continuing dry weather and higher than normal temperatures in the southern half right through until August.

Similarly, dry weather is affecting crop development across Russia and the Black Sea region, while in the southern hemisphere, it is delaying Australian winter wheat sowings.

Private analysts are talking down the Russian harvest by 2m tonnes to 3m tonnes, according to Mr Conway.

Meanwhile, EU wheat production was revised down by 4m tonnes this month on top of a 4.3m tonne write down last month. This would represent a 5pc drop on last season's production.

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