Feed Wheat Slumps £10.00/T

Both old and new crop feed wheat values have come under further pressure this week as currency fluctuations continue to dominate market direction.

Although the Euro is weaker against the US dollar, which has in fact opened up good export opportunities for Europe in general, sterling is currently slightly stronger against the Euro when compared to its pre-Christmas position.

Consequently the European grain market, priced in Euro’s, has remained buoyant this week as exporters, particularly French ones, take chance of this increased demand. The UK grain market, priced in sterling, has however retreated this week as it fails to effectively compete with European values.

Old crop feed wheat for spot collection is currently valued in the region of £130.00/T ex-farm; spot values have fallen around £10.00/T since the beginning of the year.

Further forward, spring collection is offering a small carry at this stage although there are some good opportunities available for movement into the early summer months for those of you who are flexible on long term storage options – please contact the office for more information on this.

Feed barley is currently valued in the region of £120.00/T – £122.00/T – plentiful demand is allowing for rapid movement off the farm at the minute.

OSR values have also come under pressure this week, again due to sterling strength against the Euro. Old crop values for spot collection had traded up to £265.00/T ex-farm last week and although many farm-sellers had insisted that they were holding out for higher values, it turned out to be a popular value – with the addition of bonuses, total values may not have been far off the £300.00/T ex-farm that many long-term holders had been targeting since before harvest last year.

Currently, £255.00 – £260.00/T ex-farm looks like a more realistic offer for February collection.

Looking ahead, the USDA appear to have disregarded any ‘weather issues’ over in South America for the time being and with harvesting of this season’s record South American soybean crop to begin in the next few weeks, time may be running out for a further weather induced price rally.

Regardless, a lack of farm-selling appears to be keeping the European market buoyant; values are already £35.00/T higher than they were at harvest.

For those of you with large quantities still left to sell, I would keep a close eye on harvesting progress in Brazil over the next few weeks. A 95 million tonne crop may break records, but logistical issues are common; perhaps a European alternative would be a safer option for importers? Watch this space.