Harvest 2013 – A repeat of 2001
Posted by Anderson Grain Marketing on Apr 23, 2013 in AGM News | 0 comments
The last seven days have brought a rather mixed week to the grain markets; old crop values have continued to decline well below the benchmark £200/T, whilst new crop values have held onto their £180/T position for post-harvest collection.
Spot collection feed wheat then is currently valued somewhere around the £196/T ex-farm mark (depending on quality specification and farm location) whilst late summer collection would perhaps offer a couple of pounds per tonne more (if you could locate a buyer). Trade volumes have however been slightly better this week, presumably as many farm-sellers are becoming more willing to settle below the £200/T mark.
As for anything with quality, full specification group 1 varieties are currently offering around a £15-18/T premium (with the nearest buyer being Manchester based for those of you seeking ‘local’ delivery). Lower specification group 1 and 2 varieties are offering around a £12/T premium but again with little buyer interest – high protein German wheat seems to be the Miller’s preference these days.
New crop values have remained fairly static this week, with harvest collection valued around the £175/T ex-farm mark whilst November movement would make £180/T ex-farm. Trade volumes have been slightly better this week also, particularly so for harvest collection as many growers finally begin to gain at least a little confidence in next season’s crops; a good warm rain this week would perhaps just encourage the rest to start selling.
On the other hand, and for French analyst group Strategie Grains, winter wheat crops across Europe (and more specifically here in the UK) are not exactly in the best shape.
The analyst group reduced their forecast for next season’s (2013 harvest) EU wheat crop by more than 0.5M/T last week, leaving the current estimated tonnage at a little more than 131M/T. A ‘downgrade to UK production prospects’, reduced by a further 330,000/T, was cited as being predominantly responsible for the reduction
“Wet and cold weather throughout much of 2013 has severely hampered the development of what little winter what was sown back in the autumn of 2012 (when around 25% of winter wheat plantings were simply unfulfilled). Furthermore, the poor weather has done little to encourage spring sowings, the majority of which are now well behind schedule compared to the HGCA’s 5 year average”.
The additional downgrade to the 2013 UK wheat crop has left a forecast tonnage of just 11.7M/T; a result which would be the lowest since the 11.5M/T produced back in 2001.
Meanwhile, OSR values made some notable gains towards the end of last week as old crop OSR crept back towards the £390/T ex-farm mark for spot collection. New crop OSR also made some notable gains with harvest collection currently offering around £355/T ex-farm.
However, markets appear to have rallied due to ‘French trading complexities’ rather than any physical alterations to supply and demand. For those of you with old crop OSR still available for movement (particularly if you don’t have the flexibility of late summer collection), £390+/T could potentially be good value.