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Published: 21 october 2020 10:05

Experts advise Lithuanian farmers to take advantage of rising grain prices

J. Andriejauskaitės / 15min nuotr. / Grain

Adverse weather conditions in some European countries and Russian farms have delayed the sowing of winter crops. Although it is too early to draw any conclusions about the harvest next year, international grain markets are already responding to the situation by raising prices. Market experts are advising Lithuanian farmers to take advantage of higher prices.

“The grain prices in the French MATIF futures exchange have reached unprecedented highs, however, international buyers have slowed down and are closely monitoring the market. The sharp rise of wheat prices was provoked by the information released by the US Department of Agriculture regarding the dip in the availability of corn stocks. Meanwhile, the forecast for soybean stock decreased which caused the growth of rapeseed grain price“, - the situation in the international grain market described Svajūnas Banelis, Head of Grain Trade at “AB Linas Agro”.

Although experts are saying that the quality of crops this year is going to be slightly worse than in the autumn of 2019, farmers in the Baltic states are not facing any significant challenges while sowing winter crops. On the other hand, the biggest European grain growers and exporters such as Russia, Ukraine and France are facing massive issues, due to adverse weather conditions.

“It is too early to talk about the negative effects of drought in Russia and Ukraine. Nevertheless, it is clear that without the sufficient rainfall their winter crops are going to be weak and will not endure the cold weather. France is experiencing a difficult situation too as they went from a long drought to having heavy rains. French must sow all of their planned fields, otherwise, they will struggle all season long”, - says Svajūnas Banelis.

S. Banelis says that the international grain markets are fluctuating accordingly to weather conditions. “The price of wheat for December 2021 has reached a very high level in the MATIF future exchange. It is a perfect opportunity for Lithuanian farmers to take advantage of the situation and get good contracts for the next year. We are strongly advising farmers not to miss the peak in prices and sell their grain at the best price. This, of course, should be done responsibly - no one should sell more than 30 per cent of their total planned future harvest”, - explained the Head of Grain Trade at “AB Linas Agro”.

Export volumes of grain for “Linas Agro” have reached 1 million tonnes

Lithuanian farmers had a productive harvest season - each hectare delivered between 6 and 6.5 tonnes of wheat, on average. Around 1.5 mln tonnes of grain was bought by “AB Linas Agro”. Majority of crops presented to buyers were classed as I - II category which is the most desirable category in the grain market.

It is currently the peak for handling crops in four huge ports in the Baltic states - Klaipeda, Riga, Liepoja and Venspils - which will last until November. Even though a lot of crops were exported to other countries, many cargo ships are still waiting in line to be loaded. Saudi Arabia, Algeria and South Africa remain the main export destinations for “AB Linas Agro” this season.

“The biggest cargo streams’ flow through Klaipeda’s port, therefore, our export programme this year is very intense. Putting the workload of all four ports together, our grain volumes will soon surpass the mark of one million tonnes. We are aiming at doubling this figure, the time will tell whether we are successful. Currently, our biggest challenge is to effectively manage all cargo streams and minimise the time farmers spend queuing at our ports”, - says S. Banelis.

Leave the interpreting to us! Translated by Pasaulio spalvos

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