Week Beginning 15th June 2015

The London LIFFE wheat future for July 2015 closed at £116.50/T on Friday afternoon (12th June) – £0.05/T lower than the week previous following a volatile week. For those of you looking to move wheat by the end of June, values are roughly £2.00 – £3.00/T lower than offers for July collection. July collection has valued anywhere between £120.00/T – £125.00/T ex-farm over the last week or so. In opening trade this morning, the wheat future is unchanged but physical ex-farm values are struggling to make £120.00/T due to a lack of buyer interest.


As for new crop values, the London LIFFE wheat future closed at £124.50/T on Friday afternoon – £2.80 lower than the week previous. In opening trade this morning, the future has opened a further £1.20/T lower and is currently trading at £123.30/T. Consequently, feed wheat for as available collection off the combine at harvest is now valued in the region of £115.00/T ex-farm. For those of you who missed out on the £120.00/T ex-farm mark, this currently looks like a realistic value for October collection. During the week’s volatility, ex-farm values did touch upon £125.00/T for September collection as the wheat future briefly reached the £130.00/T mark, but this was to be short lived.


This month’s World Agricultural Supply and Demand Estimates (WASDE), courtesy of the US Department of Agriculture (USDA) was released at the beginning of last week and appears to be predominantly responsible for the downward pressure added to the grain markets. Ending stocks for the current 2014-2015 are plentiful and production prospects for the upcoming northern hemisphere harvests are promising – despite the recent ‘weather worries’. 

 A few of the key points are listed below: (All figures otherwise stated refer to the upcoming 2015-2016 trading season which commences 1st July. Any month to month increases are based on the May edition of the report).


Please see here to view the report in full:





  • Global beginning stocks are reduced by 0.56 million tonnes to 200.41 million tonnes.
  • Global wheat production is raised this month by 2.6 million tonnes to 721.55 million tonnes – just 4.77 million tonnes smaller than last season’s record crop. American production is raised by 0.91 million tonnes to 57.72 million tonnes on ‘improved prospects for the Hard Red Winter Wheat Crop in the Central Plains following the late season rains’.
  • Production is raised 1.5 million tonnes for Russia (now 55M/T) and 1 million tonnes for the Ukraine (now 23M/T) due to ‘improved spring grains’. Small changes are made to Southern Hemisphere crops but the majority of these are hardly established at this stage.
  • European production is raised 0.4 million tonnes due to ‘good conditions in the UK and France’. Imports are also raised for Europe by 0.5 million tonnes due to a large, competitively priced Ukrainian surplus.


  • Global beginning stocks are increased by a significant 4.51 million tonnes to 197.01 million tonnes.
  • Global maize corn production is reduced by 0.53 million tonnes to 989.30 million tonnes – just 1.34 million tonnes smaller than last season’s crop. American production is unchanged at 346.22 million tonnes.
  • Russian production is increased by 1 million tonnes – ‘planting progress data has indicated a year to year increase in the seeded area’
  • Looking back to the WASDE for the current 2014-2015 season, maize corn production is raised by 3 million tonnes to a near record 81 million tonnes due to larger harvested areas. ‘Yields are also projected higher for the remainder of the crop due to extend periods of rainfall throughout May’.


  • Global oilseed production is increased by 0.7 million tonnes at 531.9 million tonnes
  • European OSR production is increased by 0.5 million tonnes to 22.1 million tonnes due to improved yield prospects.
  • Looking back to the WASDE for the current 2014-2015 season, Argentinean soybean production is increased by 1 million tonnes to 59.5 million tonnes due to a larger harvested area – this could help ease the transition between southern hemisphere / northern hemisphere supplies.


    Elsewhere, Preliminary grain production figures for Australia were released towards the end of last week and whilst these numbers should be treat with caution, it does give us an insight of potential crop prospects. 13.8 million hectares worth of land is drilled with wheat, a slight decrease on last year. The barley area has increased 4% on last year at 4 million hectares and the canola area has reduced by 13% to 2.3 million hectares – presumably due to both poor market values and dry conditions during the planting period (please see hgca.com for more on this). With regard to yields, most expectations are average despite the ongoing threat of the El Nino weather event – the 2015-2016 wheat crop should top 23.6 million tonnes.


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