Following bumper crops in nearly all other major exporting countries, wheat prices from these origins have fallen more sharply. Overall, there have been two opposite factors influencing price developments since the start of the season. On the one hand, there was concerns over the low level of wheat stocks, especially in the United States, which provided support to wheat prices. On the other hand, prospects for ample export supplies in Argentina and Australia have contributed to greater competition among the major exporters and exerted downward pressure on wheat prices. Prices relate to the fourth week of the month.
Prices refer to third weeh of the month.
Looking at the futures market, price developments in recent weeks have demonstrated the market's sensitivity to the prospects for the 1997 crops. However, by the start of the fourth week in December, wheat prices began to decline, following signs of an improvement in the weather outlook in both the United States and Argentina. In January 1997, the release of the latest official US figures pointing to a drop of about 7 percent in winter wheat planting from last year to their lowest level in 20 years lead to strong rallies in Chicago prices, providing support to both March and May futures. After a sharp fall since late August 1996, international maize prices seem to have stabilised. Nevertheless, international maize prices could come under downward pressure later in the season due to keener competition among major exporters combined with declining wheat prices and larger availabilities of low quality wheat which could substitute for maize in feed rations.