The months since the 2010 Purchasing Seminar sponsored by Milling & Baking News was held in early June have been difficult for ingredient buyers. Wheat futures prices were surging in early market trading on Sept. 17 and stood at levels more than 60% above prevailing prices in June when the seminar was conducted.
A follow-up webinar broadcast on Sept. 17 offered ingredient buyers cause for hope for lower prices in the weeks and months ahead, but relief was hardly a sure thing. With larger wheat supplies likely in 2011, there is cause to expect downward price movement steadily as the spring growing season approaches.
Still, a meteorologist warned in the webinar of a large number of key growing regions facing difficult conditions (including Canada, Argentina, Australia and Russia) and prospects for trouble extending well into 2011.
Uncertainty in the worldwide supply/demand picture for soybeans and corn throws an additional wrench into forecasts of declining wheat prices, as does weakness in the value of the U.S. dollar and the continued possibility of large fund infusions into commodities.
The speakers’ overarching advice was for ingredient buyers to gird themselves for additional volatility, which likely will be difficult to escape for the foreseeable future.