Warning on wheat stocks

Mar 4 2008 by Sam Wood, The Journal

IT WILL take more than a year of successful global wheat harvests to replenish the world’s wheat stocks - and market volatility is here to stay, was the grim message from this year’s HGCA Milling Wheat Conference.

The conference, held last week in Cambridge, explained the record wheat prices and indicated what might happen in the wheat market over the coming season and year ahead.

Heike Hintze-Gharres, HGCA markets analysis manager, said: “Although the world wheat crop is expected to show a sharp increase this year, favourable weather conditions are essential if world wheat stocks are to start to show signs of recovering.

“The new season is starting with very low stocks and the tight supply and demand situation which has led to record high prices is unlikely to subside in the short-term.

“The UK crop last year was 1.6 million tonnes lower than in 2006 with overall quality lower. Only 11% of the crop met the bread-wheat quality specifications compared with over 40% in 2006. The crop last year was damaged by weather conditions so even though more wheat is reported to be in the ground this year, weather will be crucial.”

The conference also looked at the implications of applying nitrogen to wheat and achieving milling quality from a miller’s perspective.