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Bird flu sees wheat values slide

Published on 23 February, 2006, Last updated at 23:00 GMT
 

23th Feb, 2006 - The threat of avian flu has caused wheat values to slip this week as poultry feed manufacturers avoid committing to any large tonnages.

Fears that demand for UK poultry could plummet if the virus is found in Britain shaved 1-2/t off ex-farm feed wheat prices in some regions.

Nick Oakhill, senior trader at Glencore Grain, said feed manufacturers were buying only on a hand-to-mouth basis.

"Buyers have reduced business because of the theory that feed demand will drop should birds have to go indoors.

At the same time sellers are trying to move grain now while there is still a demand."

May futures for old crop wheat had dropped from 73.75 to 72.60/t, while the French MATIF market had lost about 1 to 112/t on Wednesday, 22 February.

But grain traders' spot prices were down as much as 2/t, particularly in the East Midlands and East Anglia, with February wheat worth about 65/t.

But, unless the avian flu situation changed, it was unlikely prices would move further, said David Doyle, head of Grainfarmers' wheat desk.

"All the fundamentals remain the same.

In terms of general supply and demand, the UK grain market has a relatively tight balance sheet."

 

 
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