Harvest hopes push Spanish grain prices lower

Spanish grain prices fell further on Wednesday with consumers shrugging off concerns over dry French weather and focusing instead on expectations of a plentiful local harvest.
Imported feed wheat in the major Mediterranean port of Tarragona for September to December delivery was quoted at 123 to 127 euros ($149.3 to $154.2) a tonne, down from 128 to 129 euros last week.
French prices rose this week on worries high temperatures could damage the crop but Spanish traders said as France was not a major feed wheat supplier and Spain would not need to import much French barley this year with its own bumper crop, customers were unconcerned.
"Buyers aren't buying and sellers have to sell at any old price, such as 123 euros a tonne," one trader said. Dealers said they were selling below the cost of replacing stocks.
Dealers said customers, including heavy-weight feed-makers, were hanging out for lower prices, and expecting cheap wheat imported from Ukraine to push prices lower.
Two years ago feed wheat fell as low as 111 euros a tonne, traders said, helped by large imports from the Black Sea area.
"The big buyers still haven't bought new crop," a Madrid-based trader said. He estimated some 400,000 tonnes of imported feed wheat had been bought for September to December.
Other traders said between 30 and 40 percent of the market's needs had been covered for the period.
Jorge de Saja, secretary general of feed-makers' confederation CESFAC, which represents makers of 80 percent of Spanish feed, also said end users were reluctant.
"The feed-maker is holding out...he's buying just what is strictly necessary."
Farmers said the weather was good and the harvest, which started at the end of May in the southern region of Andalusia, moving later into Extremadura and Catalonia, had started in the central region of Castille-La Mancha.
But late-planted barley in the north was entering a critical phase and if there was a heat-wave, it could be damaged, Spanish Cereal and Oilseed Trade Association President Pelayo Moreno said.
Maize prices also fell, to 169 to 174 euros a tonne from 174 last week, pushed lower by falling wheat and barley prices. Lower consumption, as farmers opt for cheaper wheat and barley before the autumn maize harvest, was also weighing on prices.
A senior Tarragona port source said there were some 50,000 to 60,000 tonnes of maize in port stores, which traders said would likely last to September.
New shipments of other grain to Tarragona were scarce, the source said, with one 3,000 tonne ship of British milling wheat due this week.