The starch market is drifting higher across most types, though the reasons differ by crop and one product is bucking the trend.
Wheat starch: costs and a damaged crop
Wheat starch prices rose slightly over the month, with producers still absorbing higher input costs even as sales ran ahead of the same period last year. Europe’s May and June heatwaves damaged the wheat crop in several leading producers and pulled harvest forward by weeks in some regions, leaving processors juggling efficiency, quality and margin. MATIF and CBOT wheat futures drifted through the month but finished close to where they started. Vesper’s outlook is slightly bullish.
Tapioca: a tightening supply picture
Tapioca starch is firmer, and the supply picture behind it is tightening. Low cassava prices last year pushed Southeast Asian farmers toward higher-value crops like sugar cane, coffee and cinnamon, and elevated prices for cassava chips in animal feed and ethanol are pulling roots away from starch producers. The small August harvest is unlikely to help given poor root quality; real relief only comes with the main crop from November. Declining acreage, strong export demand and weather keep the outlook bullish.
Potato: the exception
Potato starch is the exception, holding broadly stable. Spot values steadied after earlier declines, giving buyers comparatively attractive pricing. New-crop acreage is down around 15% year-on-year to avoid another glut, and while the heatwaves hit some growing regions and producers are pushing for higher Q3 prices, weak export demand and ample supply are working against them. One major producer expects to carry more stock than planned into the period.
Corn: modest gains
Corn starch rose slightly, with demand still subdued and producers facing the same input-cost squeeze. MATIF corn futures gained on the month and CBOT edged up. A Q3 push for higher prices largely fell flat, securing only modest increases, while higher freight rates squeezed margins on bulk shipments.
Running underneath all four: the Middle East conflict continues to lift fuel costs and disrupt shipping, and US tariffs on the relevant derivatives sit at 10%.
