International grain prices have continued to press lower as Black Sea wheat production estimates climb and improving North American weather.
Improving weather and seasonal pressure saw United States corn and wheat futures prices finish last week sharply lower. Most wheat and corn futures contracts forged new seasonal lows with the improving chances of a record large US corn crop at a time when there is already an abundance of global feed grains.
Sharp declines in corn futures also weighed on wheat, where US farmers are in the middle of harvesting winter wheat crops. High protein spring wheat futures tumbled after parched areas of North Dakota and the Canadian Prairies received soaking rains.
European and Black Sea wheat prices pressed lower with the declines in US markets as well as the prospects of a large Russian wheat harvest. Russia is broadly expected to harvest its second largest wheat crop behind the record large harvest in 2017 of 85 million tonnes, after improved rains in May and June across the major production areas. Most forecasters are now pegging Russia's 2020 wheat harvest at around 80mt, sharply higher than last year's crop of 73.6mt.
Comfortable global wheat supplies are putting pressure on global prices. The International Grains Council lifted its forecast for world wheat production for the 2020/21 season by 2mt to a record large 768mt.
Local prices remain mixed. Old season grain prices are edging higher as the large shipping programs of interstate wheat and barley into Queensland wind down before the new crop harvest.
Barley for a July delivery into the Darling Downs was about $5 higher for the week to $340 delivered while stock feed wheat values were $395. However, demand is sporadic and limited as buyers wait for cheaper new crop supplies.
New crop prices are steady. New season's barley for a January delivery was unchanged at $265 delivered into Darling Downs destinations. New crop stockfeed wheat was softer at $290 down from $295 last week.
Queensland crops have responded to the mid-June rain, but early July rain is needed to avoid another disappointing harvest. Crop conditions are highly variable, with some farmers still saying crops are in good shape, while others are close to throwing in the towel for the 2020 winter crop harvest.
The Bureau of Meteorology is forecasting a dry start to July with the chance of improved rain in the second half of the month.
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