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 Amid continued volatility, the fall in maize
prices has been more significant in recent weeks than for other major
cereals. The late recovery in yield prospects in the United States, the
world’s largest maize producer and exporter, has been one of the main
reasons, while prospects for large supplies of feed wheat and the
decline in crude oil prices also added to the downward pressure. In the
first three weeks of August, US maize (No. 2 Yellow, Gulf) averaged USD
227 per tonne, down by USD 40 per tonne, or 15 percent from July. At
this level, maize prices were still 50 percent above August 2007,
although the price a year earlier was exceptionally low for the time of
the season. The US maize futures continued a downward trend that
started in late July. The CBOT maize futures for December delivery
averaged USD 217 per tonne in the first three weeks of August, down 16
percent from July and 25 percent below the all time high in May.
International wheat
prices also fell considerably in early August, continuing the decline
that started in July in response to favourable harvest progress in
northern hemisphere countries and the expectation of larger export
availabilities in 2008/09. However, later in the month, excessive wet
conditions in Europe, resulting in some milling crops being downgraded
for feed use only, provided support to higher quality wheat and prices
regained some of their earlier losses. The US wheat (No.2 Hard Red
Winter, f.o.b. Gulf) averaged USD 341 per tonne during the first three
weeks of the month, unchanged from the July average but 23 percent
above the corresponding period last year. In the futures market, the
Chicago Board of Trade (CBOT) December wheat futures averaged USD 307
per tonne in the first three weeks of the month, 18 percent higher than
in the corresponding period last year. This compares to an all-time
high of USD 400 per tonne average in March, which was 120 percent above
the previous year.
Since reaching all-time high levels in May 2008, international rice
prices have weakened with the arrival of new-crop supplies. Export
prices fell more sharply in August on expectation of larger exportable
supplies soon entering the market and with the firmer US dollar. In
Thailand, the Government was considering the sale of 2.1 million tonnes
of rice in September while the Rice Exports Association in Pakistan
expected a removal of the minimum export prices in that country before
the start of the main harvest in November. Earlier in the month,
Vietnam cut its minimum export price significantly, to USD 600 per
tonne. The Thai white rice, 100%B averaged USD 712 per tonne during the
first three weeks in August, down 15 percent, or USD 123 per tonne,
from July but still some 116 percent above the corresponding period
last year.
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