Wheat traders still cautious about market

On the first weekend of August, Ukraine attacked a Russian naval vessel and Russia attacked grain storage and ports, which has raised concern for global food security.

"Since the end of the Black Sea Grain Initiative, strikes carried out by Russia have destroyed 180,000 tonnes of grain inside Ukraine, including 40,000t of grain just in 24 hours," said United States State Department spokesman Matthew Miller last week.

According to CBH, more than 50 per cent of the grain being transported via the Black Sea Grain Initiative was corn - so any disruption will have a direct impact on the supply of feed grain globally.

This is good news for barley prices, which have been supported by the recent announcement of a continuation of Chinese barley trade.

A recent CBH market report said malt barley markets continue to find support globally, with a smaller year-on-year malting harvest in the northern hemisphere.

This has forced the European Union to look for additional imports to meet the demand of the market, most likely coming from Argentina.

Black Sea tensions have influenced canola prices, providing some good pricing opportunities.

"Concerns around the dryness in North America and Canada have continued to see canola market movements upwards," a recent CBH market report said.

The Canadian Western Prairies are forecast to have high temperatures and lower rainfall - which can impact the critical flowering stage.

Wheat markets remain as volatile as ever, with markets uncertain after escalated conflict in the Black Sea and dismal harvests in the northern hemisphere.

"The hot and dry conditions in European and North American growing regions continue to influence the market as yield expectations have been lowered and the overall grain quality appears to be declining," the CBH report said.

Rabobank believes Western Australian wheat prices will be largely dependent on overseas market movements this year.