Week Beginning Monday 18th June 2018

New crop feed wheat has succumbed to market pressure this week despite continued weather woes throughout the Northern Hemisphere. Having been offered for the harvest period, £160.00/T ex-farm is now offered for October collection, with collection into the new year offering a small premium. For now, at least, £170.00/T ex-farm has been taken off the table! Although new crop sales have proved plentiful over the past few weeks we are still hugely surprised at the overall lack of new crop sellers at recent levels. Weather driven markets are fickle at the best of times and as shown four years ago, short term weather markets can fall as quickly as they rally. Could history be repeating itself as we head into harvest 2018?


This month’s World Agricultural Supply and Demand Estimates (WASDE) from the US Department of Agriculture landed on our desks late on the 12th June. The much-covered unfavourable weather events affecting many top exporting grain nations resulted in a bullish tone to the report, as expected. However, the figures were perhaps not as bullish as the trade was expecting, hence the added pressure to the market towards the back end of the week following the reports release.

Some of the more interesting points are briefly listed below – please see the blog section of our website to view the report in full.


  • World wheat production for the upcoming 2018-2019 trading season is this month forecast at 744.69 million tonnes, down from the 747.76 million tonnes forecast last month.
  • US wheat production is marginally increased at 49.74 million tonnes. Last season’s figure was 47.37 million tonnes.
  • Russian wheat production is lowered by 3.5 million tonnes to 68.5 million tonnes due to “drier than normal conditions this spring in winter wheat areas and excessive wetness in spring wheat regions lowering plantings. Russia’s wheat production is projected 19% lower than last season’s record 85 million tonnes. Russian wheat exports are reduced by 1.5 million tonnes to 35 million tonnes, but it will remain the world’s leading wheat exporter next season”.
  • No changes have been made this month to Australian wheat production. However, at 24 million tonnes, this is just 0.5 million tonnes higher than the poor production figure achieved last season. It is important to recognise that the recent dry weather is forecast for a further three months, particularly in crucial grain growing regions.
  • EU wheat production is reduced by 1 million tonnes this month to 149.4 million tonnes due to dry conditions this spring in both Germany and Poland.
  • Global ending stocks are raised by 1.8 million tonnes this month to 266.2 million, below last year’s record of 272.4 million tonnes.


  • World maize corn production for the upcoming 2018-2019 trading season is this month forecast at 1,052.42 million tonnes, sown from the 1,056.07 million tonnes forecast last month.
  • US maize corn production is unchanged at 356.63 million tonnes.
  • For the US, exports during the month of April were record high, besting the prior monthly shipment record set in November 1989. Export inspection data for the month of May implies continued robust global demand for US corn, while old crop outstanding sales at this point in the marketing year are at a record high.
  • Russia’s corn production is reduced due to a lower than expected planted area.
  • Global ending stocks are lowered from 159.15 million tonnes to 154.69 million tonnes this month.


Rumours of rainfall over the weekend for Russia are circulating the market this morning but opinion is mixed as to whether this will provide any relief, particularly for Southern areas. Dry weather has however continued over in Ukraine and the local agricultural authorities there have therefore lowered their production forecasts. Record May temperatures and a sever rainfall deficit has been a prominent problem in the West where 40-50% of the country’s total wheat and barley crop is produced. As a result, wheat production next season is now forecast at 25.5 million tonnes – the lowest total since 2014. Around 16 million tonnes of this will be available as an exportable surplus – a 6% reduction year on year. Barley production has also been revised down to 7.1 million tonnes, the lowest since 2012.


As for the oilseed markets, Chicago soybean futures continued their downward slide towards the end of last week to a 9-month low. The main cause of this fall, according to AHDB, was the continued pressure caused by the trade dispute between the US and China.

On Friday, the US released the final list of Chinese products on which tariffs worth $50 billion will be implemented. China is now expected to respond with a set of retaliatory tariffs, and US soybean exports are expected to be impacted. Pressure from the soya market is now being fed through into the wider oilseed complex and Paris rapeseed futures are this morning feeling the pressure.

Current new crop values are trading somewhere in the region of £285.00/T ex-farm for harvest collection.

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