Wheat market stable with slight decline
Wheat prices on the futures markets are under some pressure again this week. The physical, local market is stabilising after the price recovery in the past 2 weeks.
On the Paris futures market, the lowest point for wheat delivered in May was just below €90/tonne (on 6 March). The market then recovered and the quotation rose to €207/tonne in 2 weeks. That turned out to be too much of a good thing, after which the market fell back to a level of just above €200 per tonne.
Meanwhile, the difference compared to the new harvest has not become smaller. December wheat in Paris is still trading at €20/tonne higher than the grain traded for the month of May. Traders assume that more than enough wheat will remain available for the 2023 harvest.
Prices for new harvest higher
The relatively large stocks of this season mean that there is also a large stock at the start of the new season that starts on 1 July. The harvest in that new season is expected to be somewhat smaller, partly because less wheat has been sown in important wheat areas.
Combined with a further increase in wheat consumption, this will make the balance between supply and demand tighter than in the current season. This explains why the prices of the new harvest are at a higher level than current prices.
