Friday, February 20, 2009

Good news for grain farmers

Some good news this week coming out of the United Kingdom for our arable farmers with a top trader indicating that prices could return to 2007 levels.

Dr Klaus Schumacker of Toepfer International told British farmers that cereal stocks were still historically low at just 19% of estimated usage.

Dr Schumacker said stocks need to increase, but that isn't likely in the UK with yields expected to be well down following a decision by many to decrease inputs, because of economic difficulties. Weather problems have also added to the shortage.

Dr Schumacker also stressed the growing link between oil and grain prices, citing the amount of corn that is being used in the States as bioethanol.

Despite traders pulling out of the wheat futures market last year and the decrease in planting that caused it seems world demand for wheat remains and that is great news for our New Zealand farmers.

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