HIGHER exchange rates and weaker international markets have kept new-crop wheat markets steady.

However, continued interest in old-season wheat has pushed prices higher this week.

Old-season prices for most grades of wheat delivered to the ports of Geelong and Melbourne were up strongly earlier this week, rising by $12 to $290 a tonne.

By comparison, barley markets are subdued.

F1 feed-barley prices are $15 lower on a delivered-port basis, falling from $260 a tonne last week to $245 a tonne this week.

Feed barley is also easier on the local stockfeed markets, with Melbourne compound feeders easing feed-barley prices from $265 a tonne last week to $255 a tonne delivered to Melbourne users this week.

Traders report barley is in ample supply.

It's a buyers' market, with sellers keen to clear silos and save carry charges ahead of the harvest.

But barley prices increased significantly during August, with feed barley up $100 a tonne.

The feed-barley market, like other feed grains, is affected by the shortage resulting from drought in the Black Sea area.

Wheat is a different case. Domestic supplies are tight and buyers have been caught out by the surge in export prices triggered by the Russian and Canadian influences.

The International Grains Council in London last week put the wheat supply in perspective.

The IGC forecast that compared with the previous month, world wheat production would be eight million tonnes lower, at 644 million tonnes, consumption two million tonnes higher at 657 million tonnes, and stocks by next June eight million tonnes lower, at 184 million tonnes.

The IGC anticipates supplies will meet demand.

Rain in Europe last week also affected markets.

In Germany, the wheat harvest has just passed half-way and a substantial portion of its crop is vulnerable to weather damage.

The same rain has been welcomed in Russia, whose wheat farmers now have some hope of planting their winter crop.

The supply channels for wheat continue to settle following Russia's ban on wheat exports.

Egypt is now a strong buyer of French, as well as German wheat.

Prices for Australian wheat this year and next should benefit from the fallout from the Russia drought, as low-priced Black Sea wheat has been shipped to key Australian markets in South East Asia in the past few years.