Week Beginning 29th March 2016

The London LIFFE wheat future for May 2016 closed at £105.00/T on Thursday 24^th March – an early close ahead of the 4 day Bank Holiday Weekend. In opening trade this morning the future is valued £1.00/T higher at £106.00/T.

With another shortened week ahead, markets are quiet this morning with limited buyer interest.

Those that are looking to make a purchase appear to be ignoring the fact that the screen is higher this morning – feed wheat for April collection is currently unchanged at £102.00/T – £103.00/T ex-farm. As for feed barley, £96.00/T – £97.00/T ex-farm is offered for April collection this morning. For those of you looking for £100.00/T ex-farm for feed barley, May/June collection may be negotiable – please contact the office.

As for new crop values, the London LIFFE wheat future for November 2016 closed at £118.75/T on Thursday evening, £1.65/T higher than the close on the previous Friday.

Buyer interest is again limited although ex-farm values do appear to be moving in accordance with the screen – more so than old crop values anyway. £110.00/T – £112.00/T ex-farm currently looks like a realistic offer for September collection. For those of you who are interested in as available collection off the combine at harvest, values are priced at a heavy discount to September values, presumably due to the sheer volume of old crop carryover which is expected to be available at harvest.

Spring planting is now well underway here in East Yorkshire although the recent rainfall which typically fell over the Bank Holiday weekend should slow things down this week. We should see some numbers regarding the amount of land currently drilled across the UK later in the week. Some seed varieties are still available for those of you who need any extra – please contact the office for more information.

According to the latest EU Crop Monitoring Report (please see AHDB.com for more), total wheat and barley yields across the EU-28 are forecast to fall 5% and 3% respectively in 2016 compared to last year’s levels. However, if both wheat yields of 5.7/Tonnes per Hectare and barley yields of 4.87/Tonnes per Hectare are realised as forecast, yields would still be higher than the five year average.

AHDB have added that the above ‘relatively high yield projections are due to mild winter temperatures and generally good rainfall throughout Europe so far – crops are extremely advanced in some areas’.

Elsewhere, the Argentinean government have upgraded their forecast for this season’s maize corn crop. Initial estimates were already healthy due to the latest trade policy measures introduced by the new government, but a period of “favourable weather had allowed for the addition of further late plantings” has lead to a revision of initial estimates.

The latest forecast given by the US Department of Agriculture (USDA) is line with the previous record of 27 million tonnes. Other independent analysts have forecast the crop anywhere between 25 – 28 million tonnes. The revised forecast by the Argentinean Government last week pegs the crop at a staggering 37 million tonnes.

However, harvest progress is still in its early days with only 7% cut as of 23^rd March (we should see a more recent estimate over the next couple of days). Yields are rumoured to be higher than normal although regional differences are already becoming evident – any numbers could be misleading at this stage.

It is interesting to note that alongside a production forecast of 27 million tonnes, the USDA forecast a maize corn export figure of 17 million tonnes – in other words they estimate that 63% of total production will be exported. It will be interesting to see if this figure is revised once the government advised increase to production is considered. If 63% of total production is to be exported, we will need to see exports of 23.3 million tonnes – another record figure.