BLOG

Grain prices stabilize, demand remains robust

11 December 20233 min reading

Grain markets are experiencing relative calm as the year comes to an end, with prices for most grains and oilseeds settling 15 to 20 percent below January 2022 levels, according to the Agricultural Market Information System (AMIS) December Market Monitor report released on December 7. Despite a slowing global economy, demand for agricultural products remains strong and is expected to hit record levels in the 2023/24 marketing season. 

“Lower prices mean reduced profitability for grain and oilseed farmers though lower costs for fuel and fertilizer will help mitigate that impact,” the report said. Fertilizer prices reached record highs in spring 2022 on the back of returning demand after the Covid-19 pandemic and tensions in the Black Sea region. The AMIS report also offers an in-depth analysis of international prices for major grains. Here are the details from the report:

WHEAT

Amid seasonal pressure in Argentina and Australia, the International Grains Council’s (IGC) Grains and Oilseeds Index (GOI) wheat sub-index averaged 2 percent lower month-on-month, reaching a new two-and-a-half-year low. While competition from Black Sea origins persisted, export prices in the Russian Federation rose markedly amid a firmer rouble and slowing grower selling, while a recent storm disrupted port logistics. EU prices (France) were buoyed by reluctant farmer selling amid delayed 2024/25 winter sowings, with optimism about export prospects supported by Black Sea weather-related issues. After the initial dip, US fob quotations recovered towards the end of November on an uptick in demand, including from China. Prices in Ukraine were thinly quoted. Although logistics were affected by severe weather conditions, participants noted burgeoning shipments via deep sea ports and rising local prices.

MAIZE

A mostly softer tone prevailed on maize export markets in November, with the GOI sub-index dropping by an average of 7 percent month-on-month. There was a notable pullback in quotations in Argentina, linked mainly to accelerated producer selling interest, albeit with market activity generally muted due to the presidential elections. US (Gulf) prices weakened on seasonal harvest pressure, occasionally tepid overseas buying interest and news of USDA's record production estimate. Spillover from other markets contributed to modest declines in Brazil but with the downside contained by stronger premiums, tied to complicated logistics and a busy export program.

RICE

Average international rice prices ticked higher month-on-month but with mixed movements across major exporters. While Thailand's white and parboiled rice quotes were little changed, as new crop pressure was offset by an uptick in buying interest and supportive currency movements, solid gains were seen in Vietnam, as local demand and tightening availabilities of the summer/autumn crop underpinned. Offers also advanced in Pakistan amid steady offshore purchasing, while Indian parboiled quotes retreated slightly as buying interest from key West African markets remained subdued. Elsewhere, South American offers surged amid elevated local prices and tight availabilities.

Articles in News Category
13 December 20183 min reading

Wheat consumption per person reaches 214 kilograms annually

Abülkadir Külahçıoğlu, the Chairman of Pasta Industrialists Association of Turkey, said the consump...

13 September 20183 min reading

Saudi Arabia stops buying Canadian wheat and barley

Saudi Arabia’s main state wheat buying agency has told grains exporters it will no longer buy Canad...

20 April 20212 min reading

Gericke delivers pneumatic conveying systems to transport rice

Gericke has designed and delivered several dense phase conveying systems for transporting dry rice ...