Wheat prices are expected to stay low, despite an estimated 1m-hectare reduction in global planting.
According to market analyst Mintec, this is because global wheat production for the 2015/16 season is still expected to increase 1%, to a record high of 732.3 million tonnes.
The analyst did warn, however, that prices could rise if wheat came under pressure from other commodities.
It said: “Wheat prices have been on a downward trend throughout 2015 and early 2016, reaching a six-year low at the end of February. The downward trend was a result of large global supplies of wheat and other grains, due to bumper crops over the past few years. However, prices started to increase towards the end of February, due to concerns over lower plantings for the 2015/2016 season.”
Winter Planting Survey
The report comes on top of the Agriculture & Horticulture Development Board’s (AHDB’s) recent release of its Winter Planting Survey. It revealed that the levels of English and Welsh wheat planting to 1 December were marginally less than last year, down 0.03 million hectares to 1.66 million hectares. It suggested this would mean the total area of planting was likely to be similar to the previous season.
The AHDB said: “Without higher levels of late winter and spring plantings year on year, the 2016 England and Wales total wheat area is likely to be similar to that harvested in 2015. The crop remains the mainstay of many rotations.”