Week Beginning Tuesday 23rd April 2019

THIS MORNING’S LONDON LIFFE WHEAT FUTURES:

  • MAY 2019 – £162.10/T (£0.40/T lower since last Monday’s opening trade).
  • NOVEMBER 2019 – £146.90/T (£1.35/T lower since last Monday’s opening trade.)
  • MAY 2020 – £154.00/T (£0.60/T higher since last Monday’s opening trade.)
  • NOV 2020 – £150.50/T (£1.00/T higher since last Monday’s opening trade)

 

POUND Vs EURO

TUESDAY 23RD APRIL – 1.1558

MONDAY 15TH APRIL – 1.1573

MONDAY 8TH APRIL – 1.1622

MONDAY 1ST APRIL – 1.1623

MONDAY 25TH MARCH – 1.1637

MONDAY 19TH MARCH – 1.1676

 

The price differential between old and new crop wheat is currently the highest it has been for eight years, since April 2011. This is reflective of the good development of new crop wheat this year – at the end of March 95% of the UK winter wheat crop was rated as “good to Excellent”.

With the forecast now turning cooler and wetter this week, dryness concerns are slightly easing although it is uncertain at this stage just how much we will receive.

 

The markets are extremely slow this morning as the trade returns to work following the 4-day weekend.

Feed wheat for spot collection has retreated to £162.00/T ex-farm this morning and buyer interest is minimal. I would expect things will pick up this week as there should be a lot of business still left to do this side of harvest, particularly into June/July. As for the new crop, £140.00/T ex-farm remains tradeable for September but there is little interest in much else at this stage.

 

OSR remains tradeable at £305.00/T ex-farm for May collection. Harvest collection is now valued at £300.00/T ex-farm.

 

There is a fantastic round-up of the latest new crop expectations on the AHDB website this week, please see:

https://cereals.ahdb.org.uk/markets/market-news/2019/april/17/grain-market-daily-170419.aspx

RUSSIA:

The Russian agricultural consultancy has announced a revised figure for next season’s wheat production of 83.4 million tonnes. This is a 3.4 million tonne increase on the previous estimate, suggesting that prospects are good. Russia will remain the worlds largest exporter of wheat next season so this should have a bearish effect on the market.

SPAIN & PORTUGAL:

Growing rain deficits in Spain and Portugal alongside increasing temperatures are beginning to impact developing crops there. Soft wheat yields in Spain are now forecast to be 20% behind on last year.

GERMANY:

Despite the recent reduction to EU production expectations, Germany have forecast a jump of 20.6% on the year to 24.4 million tonnes. If realised, German production would be the highest since 2015/16.

US:

60% of the winter wheat crop is in a “good to excellent” condition, unchanged on the week and in line with trade expectations. Only 31% of winter wheat crops were classified as “good to excellent” this time last year. Looking ahead, the forecast is largely supportive of new crop development. Also, it is important to note that wheat ending stocks for the US are forecast at 29.5 million tonnes this season, the third highest level on record due to a slow export campaign this season.

CANADA:

Wheat production is currently forecast at 28 million tonnes, an 8% increase on last year. However, this increase in production is largely down to an increase in spring wheat, which is yet to be planted.


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