Minimal movement expected on corn and wheat prices
From Bakery & Snacks
In its price outlook, published this week on the back of the USDA’s June WASDE (World Agricultural Supply and Demand Estimates) report, Rabobank said: “The report was predictably neutral, with minimal adjustments across the commodities. Weather conditions in the major growing areas, as well as the upcoming USDA acreage and stocks report on 30 June, will be the key price movers.”
Rabobank reported that US 2015/16 wheat production had been revised up, as the recent rain had increased yields.
Talking to BakeryandSnacks.com about what this means for the bakery and snack sectors, Stefan Vogel, global head of agri commodity markets research at Rabobank, said: “Right now, we’re in a situation where wheat stocks are relatively good versus past levels. Stocks have increased, which is good news for bakers, as it means supply is high and prices are low.”
However, he said this positive supply picture is tempered with concern about wheat quality, as rains continue in central US.
“Harvest has just started in the southern states and especially in the hard red winter belt, it has rained substantially for the last three or four weeks. When it rains before a harvest it can raise concerns about the quality of the wheat – the fear is that the protein levels might be lower,”explained Vogel.
Vogel predicts corn prices should come down in the next few weeks, on the back of good US yield prospects and the large amount of grain that is still being held in storage.
The USDA is predicting a 2014/15 yield that is slightly below last year’s record but above the harvests of recent years. Vogel believes this can be achieved with favorable weather conditions.