January 14th

Market Report

The markets have drifted even with more bullish news coming out of S. America where the heat on the Soybeans and corn is having an impact. Overnight the US is slightly down on wheat and corn but the IGC has released a report highlighting that ag commodities are tight and finely balanced going forward. They have said that the massive Aussie crop will increase world supply of feed wheat but that doesn't feel enough to offset all the other issues facing the world.

OSR took another hit yesterday on the back of a lack of bullish news this is a market that remains very volatile and not very logical. So remains the one to watch. Coupled with this is the continued rise in oil prices which is confounding many commentators, how far can oil go?

The dollar remains weak against the major seven currencies but this only makes US Doll priced commodities look cheap...will China buy?

Inflation is still prevalent in all economies and shows no sign of 'dropping out' as the central banks are hoping. An interest rate rise is not the solution but inflation has to be tackled at some point or it risks squeezing the life out global growth.
January 13th

Market Report

The USDA was a fairly flat report, wheat had bigger stocks and more carryout, soybeans and corn written down on stocks and also they factored in the decreases in S. American crops. The debate is now if this is enough of drop in the S. American yields. US wheat fell and has continued to fall over night, coupled with the weakening dollar US Ag products must be looking attractive at these levels.

EU wheat will be under pressure today but for how long, at these levels wheat is looking cheap and buyers may well come in and get some cover. Look out for an Egyptian tender coming to the market as this could be the cheapest wheat they have bought this season.

Under the radar Chinese hog prices are still very low and with a big oversupply this has limited Chinese demand for corn. Analysts see this demand not recovering for a while and this will weigh on corn demand.

It's January and we still have a long way to go, the markets have taken a hit and any buyers that are short will be seeing these levels as a potential buying opportunity.
January 12th

Market Report

Today is USDA report which will be released 5pm UK time. The trade will remain fairly quiet awaiting the detail. Soybean/ Corn crops in S. America are reduced but the trade was already aware of this, the question will be how the dry weather impacts crop conditions. Yesterday wheat markets across the globe saw a rally on the back various tenders hitting the market. Overnight US markets are flat.

OSR remains very volatile on the old crop with swings of €40 in a day not uncommon. New crop OSR is steadier on the back of a larger crop and traders focussing on how old crop will play out. The premium of old to new is currently €156 and this will have to come into line as the season goes on.

Oil has crept back over its recent contract high over the past four days. If oil keeps rising then this will add to the general woes of various economies. The Russia Ukraine spat not helping the market and North Kore continuing to test new missiles adding to uncertainty. Natural gas has also rallied but is still $2 off its high when it sparked panic in EU markets.
December 20th

Market Report

The markets consolidated on Friday after the sharp decline in prices observed during the week. This downturn is mainly due to end-of-year position closures. Wheat from France is competitive on the international scene, as shown by the purchases made last week by China, both for feed wheat and feed barley. This will compensate for the absence of Algerian purchases, amid bitter relationship with France.

On the international market, the US sold 132,000 t of soybeans to China.

In Australia, Abares revised upwards its wheat production estimate for the west of the country to 11.7 Mt from 11.5 Mt, leading to a total production for the country of 34.4 Mt.

In Argentina, the Buenos Aires Exchange revised its corn production estimate upwards to 57 Mt and wheat production to 21 Mt from 52.5 Mt and 17 Mt respectively last year.

Rapeseed prices for February deliveries reach new highs, despite the decline of oil and the expansion of the Omicron variant.

Oil prices are losing ground this morning, as is palm, amid growing concerns about health restrictions in many countries. The dollar is up this morning at 1.1250 against the euro and 74.40 against the rouble.

American market
Soybean prices were up on Friday amid concerns of poor rainfall in South America. Wheat was also recouping previous days' losses.

China remains a key element for the evolution of future prices. According to Chinese customs, corn imports in November amounted to 790,000 t, down by nearly -36% compared to last year, and wheat imports to 750,000 t, down by -7.2%. Only barley imports were up by +37.3% in the period compared to November 2020.

In Chicago, corn prices are at their highest level in 4 months.

On Friday, funds were net buyers in 2,500 lots of corn, 3,500 lots of soybeans and 2,000 lots of wheat.
December 17th

Market Report

The wheat market is still depressed and is struggling to rebound. On the other way around, the rapeseed continues to rise. After losses recorded earlier in the week, rapeseed prices soared again yesterday on Euronext to mark a new historical high on the February 2022 delivery at 724.75 €/t. The severe European and global tension on this product is taking over following the rebound observed on the vegetable oil market for both palm and soybean oil.

Yesterday, the European Commission readjusted upwards its production estimates for the current 2021/2022 campaign:
Soft wheat +0.2 Mt to 130.6 Mt
Maize +1 Mt to 69.4 Mt
Barley +0.2 Mt to 52 MT

The current downturn in international wheat prices still favours the return of importers on the market. Iran bought 500 000 t, South Korea 60 000 t, the Philippines 110 000 t and Jordan 60 000 t. A wheat tender from Turkey for 320,000 t is still in progress.

The European Central Bank was highly anticipated yesterday. It raised its inflation forecasts and announced that it will start reducing its asset purchases under the PEPP at the end of March 2022. However, Christine Largarde remains very cautious due to the uncertain health and economic context in Europe. A rate hike in the Eurozone is still considered "very unlikely" for 2022, in contrast to the US where the Fed is considering 3 rate hikes. However, the Euro/Dollar has recovered since the beginning of the week to test its highs for a month and the strong resistance zone of 1.1360 to 1.1380.

American market
Corn and soybeans continue to evolve in a very narrow price range and still benefit from some support. Traders are still waiting for new elements, especially a better understanding of the production potential in South America. The good weather conditions until now are becoming worrying in the area from the south of Brazil to the north of Argentina. The market is therefore mixed and hesitant.

Weekly US maize export sales have been buoyant last week with the inclusion of the recent exceptional sale to Mexico. The volume is at the top of expectations with 2.7 Mt cumulated for the old and new marketing years. Soybeans are strengthening thanks to the rebound of soybean oil.

Funds are buying again on all commodities in Chicago thanks to the decline in the dollar. They bought 6,000 lots of corn, 10,500 lots of soybeans and 8,500 lots of wheat.

US wheat is regaining some support with growing concerns about the expanding water deficit in the Great Plains. The condition of HRW wheat is further deteriorating due to recent strong and hot winds. In addition, weekly US wheat export sales have recovered to 650,000t, well above expectations.
December 16th

Market Report

Algeria seems to want to bring down prices of French goods, despite its competitiveness, mainly for geopolitical reasons. It is probably about 700,000 t that would have been contracted yesterday between 372 and 376 usd / t depending on the size of vessels, with goods geographically ranging from Germany to the Baltic, through the Black Sea basin. Details were not provided. Argentina could also be retained for part.

From a chartist point of view, the break of the 280 €/t support on Euronext March maturity pushed the market down, testing its next technical point of 275 €/t on the March 2022.
According to Euronext, long positions on wheat on December 10 would be held up to 64.2% by non-commercials while commercials would hold 65.5% of short positions.

In Australia, the weather is becoming a little milder and therefore favorable for harvesting. This year's wheat production on this continent is expected to be at record levels, probably above 35 million tons.

As of December 12, EU exports of wheat to third countries stood at 13.11 million tons compared to 12.06 million tons last year. This figure probably still lacks a little more than 1 million tons to be allocated to France, whose statistics are difficult to obtain from customs. Imports of corn into the EU stood at 5.94 million tons, down from 7.77 million last year.

Rapeseed lost ground yesterday, mainly in the wake of palm, canola, and oil.

Imports of rapeseed in Europe stood at 2.08 million tons on December 12 against 3.23 million last year to date.

The dollar remains firm this morning, posted at 1.1290 against the euro and 73.70 against the ruble. Oil rebounds slightly to 71.50 usd/barrel.

American market
Very sharp decline in wheat prices last night on Chicago on lack of competitiveness of U.S. produced goods internationally, coupled with chartist reasons and sales from funds. The Australian crop is progressing with better weather conditions which will inevitably lead to have a major competitor with the latter.

Soybeans found support in the NOPA figures which showed a drop in soybean oil stocks at the end of November.

Corn also gave up some ground yesterday, following wheat and a drop in ethanol production, posted last week at 1.087 million barrels and a rise in stocks to the highest since last August at 20.883 million barrels.

Funds were net buyers yesterday on 1,000 lots of soybeans but net sellers on 5,000 lots of corn and 20,000 lots of wheat.
December 08th

Market Report

Hope is returning to the financial markets as concerns about the danger of the Omicron variant subside. The S&P 500 index on the New York Stock Exchange thus returned to its pre-Thanksgiving level yesterday, while WTI oil clearly rose above the psychological threshold of $70/barrel.

This situation provides support for commodities in general and grains, even if, pending the USDA report to be released this Thursday, December 9, movements remain limited.

With the exception of rapeseed, which once again showed itself yesterday with a strong increase of up to +21 € / t in yesterday's session on the February 2021 maturity of Euronext. With a rebound of +57.75 € / t over the last 5 sessions, rapeseed is back to the doors of 700 € / t which has not been seen since November 17.

In France, the publication of FranceAgriMer's December report will be followed this morning while Agreste released yesterday its first estimates of areas for the next harvest 2022.

The area of soft winter wheat for 2022 is expected to decrease by -0.6% to 4.924 million hectares compared to 4.956 million hectares in 2021

Durum wheat is expected to decrease by -1.8% to 279,000 ha from 284,000 ha in 2021

Winter barley is up by +2.4% to 1.226 million ha from 1.197 million ha in 2021

American market
The market remained fairly mixed yesterday in Chicago with traders waiting for the USDA report on Thursday night. The consensus of analysts expects little change in U.S. inventories for the month of December. However, weaker than expected export performance could lead to a slight increase in US wheat and soybean stocks. While the good demand for corn, especially for ethanol, could lead to a very slight decrease in US stocks.

The market is also waiting for a better knowledge of crop conditions in South America for the next few weeks.

Funds bought 2,000 lots of corn and 2,000 lots of wheat in Chicago yesterday, while selling 5,500 lots of soybeans.

The U.S. administration ruled yesterday through the EPA for a retroactive downward revision of the biofuel mandates to 17.13 billion gallons for 2020 and 18.52 billion gallons for 2021 due to reduced fuel demand during the Covid-19 pandemic in the U.S. The mandate for 2022 has been increased to 20.77 billion gallons. It should also be noted that the EPA would reject multiple requests for exemptions.
December 06th

Market Report

Friday saw another sell off in the global wheat markets, in general brokers seem to be saying the Christmas lull has begun sparked off by the Omicron uncertainty. This feels very much like a repeat of last year and probably the year before that. Major multinationals have pushed workers to stay home and the knock effect has been markets taking another risk off approach. If the Omicron is mild then we could see a rapid recovery in most markets but this is too early to say.

We still await news on the 'massive' Aussie crop and how the quality has faired. Russia remains in the news with a gradual increase in its export tax on wheat and its proposed limit on wheat exports in the New Year. With that and the potential to invade the Ukraine Putin is ending the year with bang. China is relatively quiet, they are claiming to have a large corn crop so are staying out of the market for the time being. Pork prices in China remain very depressed as the glut on the market continues and no real demand. The power house of the Chinese economy is slowing and could remain stagnant as the huge and indebted property companies could still falter on massive loan repayments.

Lets hope the New Year brings a some better news.
December 03rd

Market Report

The market recovery that began on Wednesday continued yesterday to almost wipe out the fall in prices recorded from last Friday when the arrival of a new Covid variant was reported. This unprecedented volatility is particularly noticeable in rapeseed, where prices have fluctuated by more than 40 €/t between Wednesday's low and Thursday's high.

The last few days' downturn has led to new tenders. After Egypt's purchase of 600,000 t of wheat on Monday, Saudi Arabia has launched a tender in 535,000 t of milling wheat. Tunisia would have bought 100,000 t of milling wheat, 100,000 t of feed barley and 92,000 t of durum wheat. The demand for wheat has triggered a significant rebound of prices. Also, new rains are expected in Australia, which will degrade further the quality of the crops. It is difficult to estimate the percentage of feed wheat at this stage, but traders say it could exceed half of the harvested volume.

Argentina could plant 7.3 million hectares of corn this year, according to the Buenos Aires exchange, an increase of 200,000 hectares compared to the latest estimates.

Rapeseed is rebounding sharply against the backdrop of a global S&D balance deficit, despite the increase of production in Australia. The rise in soybeans is also supporting prices. Also note yesterday that the US sold 130,000t of soybeans to China and 164,100t to an undisclosed destination.

According to the FAO, food prices are at their highest level since June 2011, raising fears of a crisis in the poorest countries.

The Eurodollar is steady at 1.1300 and The Dollar vs. Rouble is dealing at 73.75 . Oil is progressing at 67.80 $/b in NY despite OPEC+'s decision to maintain its production increase of 400,000 bpd in January. However, the cartel reserves the right to adjust its policy at any time depending on market developments.

American market
Wheat prices in Chicago rebounded sharply yesterday. However, they have not yet erased early week losses, mainly fuelled last Monday by Abares' figures about a record wheat production in Australia, one of the main competitors of the USA on the export markets.

Soybean is rebounding, amid new US export sales to China. However, from March onwards, competition from Brazil will be fierce, with production expected to reach a record high, except if end-of-cycle incidents occur.

Yesterday, funds were net buyers in 7,500 lots of corn, 8,500 lots of soybeans and 13,000 lots of wheat.
December 01st

Market Report

Panic on the markets, consequence of the Omicron variant and its impact on the world economy, impact impossible to measure at this stage. We will have to wait for the scientists' answer to apprehend the future of the markets, knowing that in the absence of new fundamental elements, it is the financial actors who are leading the dance for the moment. This is evidenced by the selling of funds, like their actions on wheat. One can assume that they have liquidated a large part of their long positions in Chicago on this product in the space of only 3 days.

Such volatility can only lead to caution and economic reasoning and management framework.

After Egypt's massive purchase of 600,000 MT of wheat on Monday, we can expect other buyers to take advantage of the current situation to accelerate their hedging.

The European Commission has posted wheat sales outside the euro zone at 11.62 million tons, partly including the French figures, which are currently posted at 1.88 million tons, figures that are still lower than the reality, since the market estimates French exports outside the EU zone to date at over 3.3 million tons.

On the international scene, the USA sold 132,000 t of soybeans yesterday to an undisclosed destination. Japan is buying a little more than 50,000 t of wheat.

Rapeseed has been the most heavily impacted by the new variant since last week, in the wake of oil, even though the fundamentals for this product are under extreme pressure following the climatic incidents in Canada this summer. Imports of rapeseed in Europe stood at 1.88 million tons on November 28, compared to 3.00 million tons last year to date. The palm was yesterday at its lowest for 2 months, but this decline seems to stabilize, if not end this morning in Kuala Lumpur.

American market
All commodity prices have lost ground in a very important way on Chicago yesterday, thanks to liquidation sales of funds in particular. This morning in the pre-opening hours, prices are rebounding in a context of uncertainties that remain very strong.

Soybeans also suffered massive sales in a context where, barring the impact of the La Nina effect early next year, Brazil could post a record crop.

Corn is also losing ground, certainly due to sales by funds, but mainly in the wake of other products. The ethanol sector, which has been very dynamic since the beginning of the campaign, could suffer from a drop in demand in the wake of oil in the event of reconfinement or travel restrictions imposed by many countries.

Funds were net sellers yesterday for volumes estimated at 30,000 lots in corn, 20,000 lots in soybeans and 22,500 lots in wheat.
November 30th

Market Report

Has the market peaked? The omicron certainly has the market worried.

Markets continued their decline yesterday, all products included, in the wake of last Friday's session, marked by the fears raised by the new Covid variant. It is difficult at this stage to know the real consequences on the world economy of this new strain that is shaking the markets. The downturn was accentuated from 2pm when Abares published its estimates for Australia. A record wheat production has been posted at 34.4 Mt, barley at 13.3 Mt, and canola at 5.7 Mt. These figures are above expectations and confirm that rains have been beneficial on volumes but the negative impact on quality is still difficult to assess at this stage.

On the international scene, Egypt surprised the market by buying no less than 600,000 t of wheat, split between 240,000 t from Romania, 240,000 t from Russia and 120,000 t from Ukraine. The French origins were not competitive.

Maize also lost ground in the wake of wheat and harvest pressure in Ukraine.

Rapeseed prices fell sharply yesterday in the wake of vegetable oils, and amid fears of a drop in demand for biofuels due to the health situation.

The same is true for palm oil in Kuala Lumpur, where prices are at their lowest for three weeks.

The dollar is weaker this morning at 1.13 against the euro and 74.75 against the rouble. Oil is back down in New York this morning at 68.50 usd/barrel.

American market
Wheat prices fell sharply in Chicago following the Abares report on Australia, but also after the USDA posted a crop rating for winter wheat of 44% as good to excellent, unchanged from last week, but above traders' expectations.

Soybeans also lost ground, despite a good crushing activity that is expected to be confirmed for the month of October. The figures will be posted on Wednesday. In Brazil, 91% of soybeans are reportedly planted as of November 26. This is ahead of the average for the period, reflecting good planting conditions.

The US corn and soybean harvest is nearing completion, with an estimated 95% done by 21 November.

Yesterday, funds were net sellers in 15,000 lots of corn, 8,000 lots of soybeans and 12,000 lots of wheat.

Our view - we consider this to be a sell off, maybe a pre Xmas one. We're encouraging growers to sell both new and old crop wheat, with an idea to look at cash settle/options in the new year. M
November 26th

Market Report

The Thanksgiving holiday meant the markets had very little direction, French and UK wheat markets traded down before recovering later in the day. Overnight the oil markets have been smashed dropping 5% on the fears of the new African variant of covid that seems to be highly contagious and and unknown. Markets hate uncertainty and this will add a sentiment to the wider markets who are dreading any further lockdowns.

In other news France has cracked on with its wheat sowing and is well ahead of last year with current drilling at 99% good conditions. UK drilled wheat looks good but its the rest of the world where our attention needs to be. Australia will have a large crop but will it be feed or milling and currently more feed wheat seems to be the answer.

That leaves Russia where conditions are dry but rains are coming and they will be desperate to drill wheat to keep food price inflation down. The troop build up on the border of Ukraine is continuing and a spat in the black sea region would really spook markets.
November 10th

Market Report

The USDA report provided some surprises with overall bullish wheat and soybeans and neutral corn.

World wheat ending stocks are estimated at 275.8 Mt compared to 276.5 Mt last month. Soybean ending stocks are seen at 103.78 Mt compared to 105.48 Mt last month. Corn yields have been revised upwards in the US to 177 bushels/acre from 176.9 estimated last month.

In this context, wheat on Euronext gained between +2 and +3 €/t, while corn was unchanged at +1 €/t. The rapeseed showed again a tremendous progression, with a gain of +14 €/t for the February 2022 delivery.

The French Ministry of Agriculture revised upwards its soft wheat production estimate to 35.456 Mt, taking into account an area of 4.974 M ha and an average yield of 7.13 t/ha. Barley production is forecast at 11.448 Mt, resulting from 1.729 M hectares with an average yield of 6.62 t/ha. In corn, the 2021 harvest is expected to be 14.5 Mt, compared to 13.9 Mt estimated last month.

The rapeseed was the biggest gainer yesterday following the USDA report. The French Ministry of Agriculture is forecasting a 2021 production of 3.297 Mt, based on an area of 983,000 ha and a yield of 3.35 t/ha.

American market
The USDA report has been surprising in soybeans by showing a US yield estimate of 51.2 bu/acre vs. 51.5 estimated last month. This number is in opposition with traders' expectations of an upward revision.

Wheat ending stocks in the 8 major exporting countries have been revised down to 48.44 Mt from 50.0 Mt estimated last month and 59.4 Mt last year. The EU's wheat production is cut by 1 Mt to 138.4 Mt, while Russia's production is unsurprisingly revised upwards to 74.5 Mt.

Estimations about corn were more or less in line with expectations with an estimated yield of 177 bu/acre compared to 176.9 bu/acre last month.

According to the Buenos Aires Exchange, the 2021's soybean production in Argentina could amount to 49 Mt compared to 43.1 Mt last year. Corn production is expected to reach 55 Mt compared to 50.5 Mt last year.

Yesterday, funds have been net buyers in 4,000 lots of corn, 17,500 lots of soybeans and 8,500 lots of wheat.
October 29th

Market Report

Grain prices fell slightly yesterday, despite the firmness in Chicago. Some consolidation is taking place after the strong rise of the last few months. The market needs new signals to take a clear direction. From a meteorological perspective, rain is expected in France from this weekend, before lower temperatures in next few days.

According to the Buenos Aires exchange, wheat production in Argentina is projected at 19.8 Mt this year, up from 19.2 Mt estimated last month. This is due to recent beneficial rains. Soybean plantings are starting and are estimated to be 4.6% complete. Corn plantings are reported to be 27.6% complete.

On the international scene, Saudi Arabia is buying 655,000t of wheat and Jordan has purchased 60,000t of feed barley from Australia.

The palm is rebounding this morning in Kuala Lumpur. To be noted, the last day of trading for the November rapeseed contract on Euronext.

The dollar is losing ground this morning at 1.1677 against the euro and 70.34 against the ruble. Oil is little changed at 82.80 usd per barrel.

American market
Wheat prices rose sharply in Chicago yesterday and reached their highest level since 2013.

In corn, the harvesting delays due to rain is supporting prices. In addition, the surge in nitrogen fertilizer prices raises questions about planting intentions in the US for next spring.

This week's wheat exports are at 69,300t, corn at 890,400t, and soybeans at 1,183Mt. These figures are disappointing compared to anticipations.

Yesterday, funds were net buyers in 5,500 lots of corn and 7,000 lots of wheat. They were net sellers in 3,000 lots of soybeans.

Black Sea market
According to the Russian Minister of Agriculture, grain production this year will amount to 123 Mt, down from 127.4 Mt previously seen. Wheat production is expected to range between 75 and 75.5 Mt. The ministry expects winter grain sowing to be at 19.5 Mha. To date, plantings remain behind schedule at 17.6 Mha compared to 18.3 Mha last year, due to water deficit.

Same scenario in Ukraine where there is some water deficit, which could lead to a drop in autumn plantings compared to expectations.

Prices in the Black Sea area rose significantly yesterday, both for corn and wheat.
October 28th

Market Report

Status quo on cereals yesterday in a market that is becoming a little more hesitant between tense balances and demand that is becoming more fragile given the new cases of covid observed in the world, particularly in China.

On the international scene, Egypt bought 180,000 t of wheat from Russia, 120,000 t from Ukraine and 60,000 t from Romania, for loading between December 1 and 10.

Sowing conditions in France for winter crops remain favorable. However, a change in weather is expected over the weekend. In addition to soaring fertilizer prices, logistical difficulties have arisen due to a shortage of trucks, which is hampering deliveries.

Corn harvesting is continuing with globally satisfactory yields, even if maturity is delayed, and therefore with increased drying costs due to the price of energy.

Palm oil is losing ground this morning, as are other vegetable oils. This could weigh on rapeseed prices, at least in the short term. Canola on the other hand was still up yesterday in Canada.

The dollar is little changed this morning at 1.1605 against the euro and 70.60 against the ruble. Oil is losing ground at 81.06 usd/barrel in New York.

American market
Corn prices were firm yesterday in Chicago in the context of a slowdown in harvesting due to rain, combined with questions about future plantings next spring given the rise in fertilizer prices. In addition, ethanol production continues to rise with 1.106 million barrels per day this week. In addition, ethanol inventories are falling, posted at 19.925 million barrels according to the EPA.

Traders will be closely watching the dirty exports that will be posted tonight. This morning in the pre-opening hours, the markets are down.

Funds were net buyers yesterday for 12,500 lots of corn, 3,000 lots of soybeans and 4,000 lots of wheat.
October 27th

Market Report

Yesterday's session was animated in a market that is becoming a little more hesitant about current price levels, at the highest since 2008 for wheat, for example. Among the factors of uncertainty, the rebound of covid cases all over the world, especially in China and Russia, leaving doubts on the vitality and sustainability of the economic recovery.

On the international scene, the USA has sold 199,000 t of soybeans to Mexico. Egypt launched a tender in wheat for loading on December 1/10.

In corn, harvesting continues even if it is behind the average of the last 5 years. Yields are globally correct.

Wheat exports from the EU outside France, whose figures are still missing, stood at 8.99 million tons on October 24, compared to 7.23 million tons last year to date. Barley exports are at 2.86 million tons compared to 2.74 million tons last year. Maize imports are down to 4.10 million tonnes from 5.40 million tonnes last year.

Rapeseed is still up in the wake of canola, which set a new high yesterday in Canada.

The dollar is little changed this morning at 1.1600 against the euro and 69.50 against the ruble. The same is true for oil, which is fairly stable at 84.00 usd/barrel. U.S. oil inventories rebounded this week.

American market
Wheat prices gave up ground last night in Chicago, notably on profit taking by funds. Only spring wheat posted a 10-year high, as a result of last spring's water deficit.

Corn found support in the slowdown in harvesting linked to the current rains in the Corn Belt. However, this slowdown should be put into perspective, as 66% of the area was estimated to be harvested last Sunday, compared to an average of 53% over the past five years.

Soybeans were stable yesterday, but benefited from the support of the 199,000 t sale to Mexico.

Funds were net sellers in wheat yesterday for 4,000 lots and net buyers in soybeans for 1,000 lots. They were neutral on corn.
October 20th

Market Report

USDA crop progress report, released last night, showed that corn and soybean harvest is progressing well with 52% of corn and 60% of soybeans harvested. Improving soybean crush margins in China has reignited strong buying from the country with trade rumours citing 40 boats booked. Improved bean shipments and a renewed global interest has spurred the domestic market forward. Chicago beans Nov-21 were trading up 6 cents and May-22 were trading up 9 cents at time of writing. Ethanol margins remain highly profitable at current rates with Brent Crude hitting a trading high today of $85.13/barrel. US corn sales of 976kt were above expectations and sales remain above USDA projections with Chinese import data yet again arguing the USDA are understating demand. Some support was seen on the back of higher fertiliser costs resulting in lower yields this growing season. CBOT corn Dec-21 was trading unchanged.

US wheat markets were mixed. Market continues to look toward the rising export tax and FOB prices in Russia are starting to make HRW competitive for the 2022 positions. The export tax rises $2.50 from tomorrow to $61.30, the 2-day calculation adds another $5 for next week and both nominal FOV values and CME futures argue for the tax to hit $90 by the start of 2022. Substantial increases. Published FOB price on the Moscow exchange yesterday was $297.90 and if the proposed tax changes are implemented (moving to FOB rather than an average), published prices will move towards current values even faster. Chicago Dec-21 was unchanged, Kansas Dec-21 was down a couple of cents and Minneapolis Dec-21 was up 5 cents at the time of writing.

EU wheat exports only marginally increased over the week to October 19th,up by 270kt. China feed buying alongside the continued shipments to Algeria and North Africa continue. Dec-21 settled down €0.25 on yesterday at €273.75/t and May-22 settled down €0.25 on yesterday at €264.50/t. London futures followed Paris with Nov-21 settling down £0.50 on yesterday at £206.50/t and May-22 settling up £0.10 on yesterday at £215.00/t.

Rapeseed continued to surge, supported by stronger veg oil prices after the Malaysian Palm Oil council cut its forecast of 2021 palm oil yesterday. Matif Nov-21 rapeseed settled up €15.50 on yesterday at €698.25/t as the contract gets squeezed and May-22 settled up €4.25 on yesterday at €652.25/t. Malaysia, the second largest palm oil producer has approved 32,000 work permits for overseas workers and with more labour, production would increase. A rebound in production would remove some of the support from palm oil prices which would also relay to rapeseed prices – the extent of the impact and whether it will have a direct impact this season is open to debate …
October 14th

Market Report

US wheat markets turned bearish in today’s trading after the uplift post WASDE report yesterday evening. As the supply side is now evident, market thoughts shift across to demand, which at current prices, is quite subdued. Market talk - front end seems amply supplied and flour mills are holding back due to the high pricing. High wheat prices forced Egypt to cancel its latest tender yesterday and Pakistan’s state grains agency only received four offers for its latest tender to buy 90kt of wheat, lowest price being $388.83/t c&f. Argentine S&D was left unchanged and no statistical assertations about the consequences of the upcoming GM fight. Chicago Dec-21 was trading 13 cents down and Kansas Dec-21 was trading 20 cents down at time of writing.

European markets followed US markets lower with both Paris and London taking a decent step lower. Demand is also subdued on European markets due to the high prices, some market correction is required to get the demand side back on board. Black Sea Nov-21 is pushing $320 FOB with no sellers, especially Russian, willing to lower prices due to the rumours of a change in the Russian export tax calculation which would change the tax from the current running average to a FOB dictated value. Russian farmers are now getting hammered as the export taxes soar which may have a significant impact on the acreage for the 2022 crop. Matif Dec-21 settled down €6.75 on yesterday at €264.75/t and May-22 settled down €6.00 on yesterday at €257.50/t. London Nov-21 settled down £4.25 on yesterday at £204.25/t and May-22 settled down £4.50 on yesterday at £210/t.

Matif rapeseed recovered after yesterday’s falls. Nov-21 settled up €5.75 on yesterday at €647/t and May-22 settled up €4.50 on yesterday at €627.25/t. Canadian Canola Nov-21 was also trading up 6 cents at the time of writing. US corn Dec-21 was trading down 12 cents after yesterday’s announcement of higher yields and ending stocks. USDA reported 161.5kt of corn sold today to an unknown buyer. Matif corn continued to drop with Nov-21 settling down €9.00 on yesterday at €240/t and Mar-22 down €9.00 on yesterday at €230.75/t. The second day of losses for Matif corn after 15 consecutive days of gains.
October 13th

Market Report

WASDE report was the main news of the day. Wheat was the winning crop as anticipated by the market in this month’s report with reduced supply. Significant reduction in supply of Hard Red Spring, Durum and White wheat for 2021/22 are expected to curtail feed and residual use. Exports are unchanged. 2021/22 US ending stocks are reduced by 35m bushels to 580m bushels, lowest US ending stocks since 2007/2008. Global wheat supplies are projected to fall by 8.6Mmt to 1,064.2Mmt on reduced beginning stocks for Iran and reduced production for Iran, USA and Canada. Iran has had 1.5Mmt taken off from production, Canada’s is reduced by 2Mmt to 21Mmt from the 23Mmt previously. Global export trade is fractionally lower at 199.6Mmt, lower Canadian exports are offset by high Aussie exports. Projected 21/22 world ending stocks are reduced by 6Mmt to 277.2Mmt, lowest since 2016/17. Chicago Dec-21 was up 4 cents and Kansas Dec-21 was up 5 cents at time of writing. Minneapolis Dec-21 was up 9 cents at time of writing.

Corn turned bearish on the back of the WASDE. US corn outlook is for slightly high production, increased exports and larger ending stocks. Global corn production is forecast down to 1,494Mmt with virtually unchanged trade. Chicago Corn Dec-21 was down 5 cents at time of writing. Soybeans got hammered on the back of higher yield and ending stocks, US 2021/22 ending stocks are projected at 320m bushels up and up 135m bushels from last year. Matif rapeseed Nov-21 settled down €9.25 on yesterday at €641.25/t and May 22 settled down €8.00 on yesterday at €622.75/t.

European wheat markets remained supported, with both the Matif and London Wheat settling higher on the back of the WASDE figures. Egypt’s GASC returned to the market to buy more wheat after it recently closed a tender to buy 240kt of wheat before cancelling the tender half an hour before the WASDE figures. The record pace of Russian exports to Kazakhstan are also questioning the size of the Kazakh crop size and export potential. Kazakh wheat crop is all spring wheat and it suffered the same hot, dry conditions as Russian spring wheat. Another 250kt of Chinese vessels are in French ports, market is questioning just how much French wheat has been sold to China and the associated quality. French agricultural industry has lowered its estimation for the 2021 soft wheat crop to 35.2Mmt from 36.1Mmt expected last month. On Monday, FranceAgriMer and Arvalis announced that only 31% of France’s soft wheat harvest has a specific weight above 76kg/hl, down on the five year average of 76%.

Matif Dec-21 wheat settled up €3.00 on yesterday at €271.50/t and May-22 settled up €4.00 on yesterday at €263.50/t. London wheat Nov-21 settled up £4.00 on yesterday at £208.50/t and May-22 settled up £3.50 on yesterday at £214.50/t. Both pushed up on the WASDE wheat outlook and bullish US wheat markets.
October 05th

Market Report

After last week’s rally in global wheat markets, US wheat futures have been mixed in today’s trading. After last Thursday’s announcement and the bullish sentiment, Chicago Dec-21 wheat gained 4.4% across the week and closed on Friday at a 6 week high. Chicago Dec-21 is currently trading a cent up and Kansas Dec-21 4 cents down at time of writing. Minneapolis Dec-21 is also trading unchanged at the time of writing. US Markets are awaiting Biden’s trade rep, Kathrine Tai’s speech later this morning. Early press predictions would indicate that the Biden administration is pushing for the full implementation of Phase 1 commitments. With 3 months to go on Phase 1, time remains for China to catch up. Washington Think tank group believes they are around 62% complete of the $113bn initially outlined.

Matif wheat remained bullish, Dec-21 settled up €1.00 on Friday at €265.25/t and May-22 settled up €1.50 on Friday at €257.50/t. Russian export quotas continue to add support. Eduard Zernin, Head of the Russian Union of Grain Exporters, announced in an email following a meeting over the weekend between the Russian Ag ministry and the Grain Exporter’s Union, that the quotas will be set from Mid Feb 2022. The quota figure will be defined based on this year’s exports and next year’s domestic demand, he said. The Russian Ag ministry expects wheat exports to be around 31.5Mmt this season, including 14Mmt in January through June 2022. Russian total winter wheat area could also decrease from last year by between 0.5-1.0m hectares (Sovecon) and 0.5m hectares (IKAR). There are also murmurs that Iran could need to triple wheat imports for 2021/22 due to crop failure fears after hot and dry conditions are leading to crop failures.

London wheat futures settled unchanged, Nov-21 settled at £202.50/t and May-22 settled down £0.25 on Friday at £209/t. Prices remain strong due to the global wheat market rally at the end of last week and due to UK feed wheat still being the cheapest on the European market, export demand continues. Delivered values are following futures’ support, feed wheat delivered into East Anglia was quoted at £200.50/t last Thursday, gaining £7.50/t Thursday to Thursday (AHDB).

Matif rapeseed found support after cooling off on Friday. Nov-21 settled up €4.75 on Friday at €649/t and May-22 settled up €4.50 on Friday at €626.75/t. Short term outlook remains bullish, but when will it hit a trading peak? Nov-21 passed the €650/t mark in today’s trading high at €650.25/t. UK delivered rapeseed was quoted into Erith at £549.50/t (Nov-21) but market rumours are saying that farmers are sti
September 28th

Market Report

Fuel shortage is taking full effect on the grain and seed trade. Trucks are parked up in yards without much hope of filling up anytime soon. Just don't mention Brexit...

After last week’s buoyant trade, US grains and oilseeds were mixed as all three commodities search for something fresh to trade while harvest activity picks up. Strong global wheat demand continues to support prices, with the 984kt issues last week. Today, the UN have issued a tender for Ethiopia amounting 200kt milling wheat issued today and Algeria’s state grain importer has also added a tender for November shipment for milling wheat, amount tbc. China has continued to purchase wheat for the 2021/22 season, opting for Australian wheat despite trade friction with volumes circa 2Mmt. China has cancelled French wheat due to quality concerns and has turned back to Down Under as pricing, logistics and quality all appear superior. Global wheat availability is still tight this season which limit’s China’s options. China is set to produce 136.9Mmt of wheat but should consume 149Mmt. Chicago Dec-21 wheat was trading a cent down and Kansas Dec-21 was up ¾ a cent at the time of writing.

Matif Dec-21 settled unchanged on Friday at €253.25/t and Matif May-22 settled up €0.25 on Friday at €244.50/t. EU exports continue, with the latest EU export data showing that over 6.5Mmt has now been shipped this season, 2Mmt up from this time last year. London wheat Nov-21 settled up £0.15 on Friday at £194.15/t and May-22 settled £0.55 up at £199.95/t. UK delivered prices followed futures gains last week. Into East Anglia (Nov-21) delivered prices rose £3.50/t to £193.00/t (Thurs-Thurs). Milling wheat Northamptonshire (Nov-21) was up £7.00/t (Thursday 23rd) at £232.00/t (AHDB).

Rapeseed continues to be bullish, especially in the front end. Matif Nov-21 settled up €6.00 on Friday’s settlement at €625.50/t and May-22 settled up €3.75 at €602.50/t. The squeeze on the front end may potentially become even more significant as we approach delivery due to the lack of supply on the market. Delivered rapeseed into Erith on Friday was quoted at £532.00/t. Chicago Soybeans were trading up, Nov-21 was up 4 cents and Mar-22 up 6 cents at the time of writing. Harvest support and Chinese demand helped the bulls. The USDA announced 334kt of beans to China in today’s news.
September 27th

Market Report

Cereal prices rose again on Friday, in a context of sustained international demand. Despite the poor quality of the French wheat crop, China is seeking French wheat. Indeed, the country has reduced its requirements, especially on the specific weight. After last week's break of the 250 €/t on the December Euronext delivery, buying interest remains high. Rumours of new export restrictions that could be imposed by Russia are also supporting prices.

On the international market, Japan bought a little more than 113 000 t of milling wheat from the USA or Canada. South Korea bought 60,000 t of corn. Algeria is launching a wheat tender for response tomorrow and shipment in November.

Fertilizer supply, especially nitrogenous fertilizer, remains a major concern for French producers, with prices soaring.

Rapeseed continues to climb, setting a new record at 619.50 euros per tonne for November on Euronext. This morning, the market should still find support in the pre-opening firmness of soybean, but also in the rise of palm and oil. According to the FOP, rapeseed areas in France could increase by 15-20% compared to last year.

American market
Wheat prices in Chicago surged again, technically supported by the break of the 7.10 usd/bushel resistance on the December maturity. However, a fierce competition from Australian origins, where the crop is expected to exceed 30 Mt, should become soon an issue.

Corn was slightly down due to a growing harvest pressure.

Traders will become increasingly cautious ahead of the September 30 report on quarterly stocks.

Funds were net buyers on Friday in 4,000 lots of wheat and 1,000 lots of soybean. However, they were net sellers in 1,000 lots of corn, due to harvest pressure.
September 24th

Market Report

Global ag markets continued to find support. US futures remained bullish with European futures also higher, not clear who is leading who, but the majority of the gains have come from market rumours of a 1.6Mmt per month export quota in Russia (creativity continues). No official confirmation of this but important to note that the quota mechanism has been in place for several years and can be activated at very short notice. Australian weather forecast is changeable but crops in the east look like they could get decent rain. Particularly important in the north as grains enter their filling stage amidst low/absent moisture, still no trade concerns on harvest expectations. The Philippines bought 2x56kt Dec-Jan Aussie feed wheat in the low $350s and Pakistan is said to have bought 575kt of wheat in an international tender that close this week. TCP (Pakistan’s national grain board) was believed to have purchased all the wheat at $383.50 c&f after several trading houses agreed to match the lowest price offered in the Monday tender. Chicago Dec-21 was up 12 cents and Kansas Dec-21 was up 13 cents at the time of writing.

Matif wheat continued to push higher, Dec-21 breaking through the €250/t barrier. Rumours of new French sales to China but nothing concrete. Silos in Rouen remain full and without a single wheat vessel in port, they have halted wheat intake. China does have 9.2Mmt of TRQ’s to take this year, so potentially an offer was made that they couldn’t refuse. Matif Dec-21 settled up €2.50 at €252/t and May-22 settled up €0.75 at €243.25/t. London followed Paris higher, Nov-21 settling up £2.50 at £194.50/t and May-22 settling up £2.60 at £200.00/t. Matif rapeseed continues to be hot, Nov-21 hitting a trading high of €617/t and settling up €8.00 on yesterday at €615/t.

The final 2020/2021 UK cereals S&D was released by the AHDB today. Key headline figure being the UK imported what at 2.43Mmt, 331kt higher than the May forecasts and up 130% from 19/20. With the poor harvest last year, this was no surprise. Barley availability increased in 20/21 to 8.12Mmt and imports up 26% to 88kt. Total domestic consumption, up by 18% year-on-year to 7.29Mmt. 21/2 wheat production is expected to recover, with expectations for total wheat crop in the region of 14.5Mmt. Stocks remain low entering this season. Quality remains a watchpoint, currently just 48% of domestic milling wheat samples are reaching 76kg/hl specific weight. Protein premiums are set to remain high in the UK.
August 13th

Market Reports

US slashes outlook for US Corn, Wheat and Soybean and significant reductions in Russia and Canada in today’s WASDE report. US corn production will likely reach 14.750 mil bushels vs a trade guess of 15,004 and the US soybean crop production at 4,339 mil bushels vs a trade guess of 4.375 mil bushels. The US Wheat crop seen at 1,697 mil bushels vs 1,723 mil bushels in July. Brazilian corn crop at 87Mmt compared to 93Mmt in July. Argentina no change at 48.5Mmt vs 48.5Mmt. Ukraine corn crop at 24Mmt vs 30.3Mmt in July.
Substantial cuts were made to Canadian and Russian wheat numbers. Russian wheat production has been reduced by 12.5Mmt to 72.5Mmt which was a larger decrease than anticipated by the trade who expected a downgrade to circa 75Mmt – 78Mmt. This was down to decreased winter wheat production which is only slightly offset by higher spring wheat output, winter wheat reduction has been made on additional data from Rosstat regarding planted area, Russia’s statistical agency. Canada’s production is lowered 7.5Mmt to 24Mmt on worsening drought conditions across the Prairie provinces during July. This would be the smallest Canadian wheat crop since 2010/11. Partially offsetting these are increases in Ukraine and Australia. Ukraine has increased anticipated wheat crop by 3.3Mmt to 33Mmt and Australia has been increased by 1.5Mmt to 30Mmt.
With larger than anticipated reductions, US markets rallied with Chicago wheat SEP-21 trading up $0.32/bushel and US corn SEP-21 trading up $0.26/bushel after the report was released. Bullish US markets supported European markets with London wheat Nov-21 reaching highs of £196.25/t before reaching last trading price of £194.95/t, and settling at £194.85/t up 5.40 on the day. Matif also rallied with last traded price for Sep-21 at €246.00/t, up €9.50/t on yesterday’s settlement price. Black sea wheat futures also rallied to last trading price for Aug-21 at $282/t, up by $11.75/t on yesterday’s settlement price.

Grain group Soufflet said today (Reuters) that much of the soft wheat and durum wheat crops being harvested in France were showing weak quality after rain-affected harvest. From soft wheat, the main setback was test weights with only 35% of crop collected by Soufflet reaching the milling standard of 76kg/hectolitre according to Francois Berson, Soufflet’s head of procurement. Spring barley remained satisfactory.
August 12th

Market Report

Wheat markets turned bullish in this afternoon’s trading on continued worries about French harvest quality combined with shipping issues at France’s largest grain export port, Rouen (Reuters). Chicago wheat were trading strongly this afternoon, DEC-21 up $0.12 per bushel on yesterday’s close. Matif and London wheat were also on a bull run this afternoon, Matif DEC-21 up €5.75/t and London NOV-21 up £4.00/t on last trading price. With a tightening wheat supply currently being received out of Rouen, exporters have been forced to compete and reinforce quality checks to meet milling standards. Summer rain has led to weak readings for test weights and Hagberg falling numbers, where Algeria has strict requirements.

US crop conditions maintained to improved over the last week, as the USDA crop progress report eased concerns about the corn crop. US corn is now rated 64% good/excellent, up two percentage points on the week. Soybean conditions were unchanged at 60% rated good/excellent. Reports suggest that this week’s trade may be quiet and choppy ahead of Thursday’s USDA report.

Matif rapeseed futures also gained support from the bullish wheat markets, with Nov-21 last trading price up €4.25/t on yesterday’s close. The Indian government today announced plans to reduce the country’s reliance on vegetable oil imports with a $1.5bn investment to grow domestic edible oil output. Currently, India is the world’s largest vegetable oil importer.
August 02nd

Market Report

Weather forecasts are again a matter of concern. Further rainfall is forecast for this week, which has pushed harvesting operations to progress during the weekend where it was possible to do so. Despite the hoped-for potential, the yields achieved are still announced as average and therefore disappointing. This situation also led to a rebound of wheat prices on Euronext by the end of session on Friday.

The firmness also extends to the corn market. In old crop, the rise is confirmed due to fears about availability in a context of a tense lean season. On Euronext, the August21 contract, which closes this week, has reached a new high. In new crop, despite reassuring growing conditions, corn prices are also adjusting upwards against other cereals.

American market
Corn and soybean prices were down slightly at the end of the week. Some position adjustments were made on Friday, last trading day before the end of July. Prospects for better weather also provided some relief, although everything remains to be confirmed by midweek.

In Chicago, wheat prices remain near the highest levels since early summer. The market continues to be driven by the prospect of large yield declines in spring wheat. Last week's crop tour in North Dakota confirmed that yield potential is down sharply compared to past years and would be the worst since 1993. This has led to a sharp increase in Minneapolis market prices, taking Chicago SRW prices in its wake.

The USDA's crop condition ratings update, due today, should further confirm the deterioration already seen in spring wheat. These figures will obviously also be scrutinised for corn and soybean.

In the Black Sea area, Russia is now the main concern, with less promising production potential in the Central and Volga regions. This deterioration is currently pushing some local analysts to revise their production estimates below 80 Mt. Therefore, this situation favours a strengthening of Russian prices. As a reminder, the USDA in its July monthly report estimated the Russian wheat production at 85 Mt. This figure could be revised downwards in the August 12 release.
July 19th

Market Report

The harvest delay in Western Europe and of course all the worries about the recent bad weather have largely supported prices throughout the past week. However, the return of prices above 210 €/t on Euronext was mainly due to the upward trend of the three wheat futures contracts listed in the US. The continued deterioration of US and Canadian spring wheat is gradually stretching the entire North American wheat S&D balance.

To note on the oil market, the agreement found on Sunday by the OPEC+ members in order to increase the production from August.

American market
For a change, wheat has been the most bullish product in Chicago since Monday's USDA report. SRW wheat has posted its biggest weekly gain since June 2015, despite very high winter wheat yields. Both the Chicago and Kansas City markets are just following the Minneapolis rally. Spring wheat degradation on both sides of the U.S.-Canadian border continues to fuel this upward spiral.

The persistence of a dry weather over the north-western part of the Corn Belt remains a support for corn and soybean prices. The soybean is also underpinned by a renewed pressure on soybean oil in the wake of the rise of canola in Canada.

Ukraine and Russia are 25% and 10% through winter barley harvest with yields well above average - 4.3 t/ha compared to an average 3.5 t/ha.

With harvest starting in earnest it will be interesting to see what quality and yields are like. Will you be combining this week?
June 21st

Market Report

Rainfall materialised across the midwest and eastern areas of the northern plains over the weekend, weighing on Chicago. Models for the week ahead point to slight wetter weather in the southeast U.S. and slightly drier weather in the western Midwest. Weather for the week ahead in Europe points to moderate rains across Central Germany and eastern France. Eastern Europe also forecast for moderate rains. Temperatures slightly below normal for southeastern UK and France, with temperatures above average in eastern Europe. Rains are limited in southern Russia with moderate rainfall further north.

Fundamental headlines are fairly muted this morning with weather and dollar strenght the primary focuses moving into this week. Friday’s COT report release has been postponed until today due to a national holiday in the United States on Friday.
Chinese state-owned importers are reported to have purchased at least eight cargos of U.S. soybeans (480Kt approx), the largest purchase in four and a half months. South Korea also purchased 136Kt of corn on Friday, expected to be sourced from South America.

The U.S. dollar continues to push higher moving into the start of this week, with the index at 92.329, its highest level since early April. EUR @ 1.1871, GBP @ 1.3817, GBPEUR @ 1.1639.
We have Export Inspections today, Crop Conditions report, the EU Monthly MARS Bulletin & EU trade data.
June 14th

Market Report

A Reuters report circulating on Friday discussed Biden relaxing rules on blending Ethanol/ bio fuel this would effectively reduce demand for corn and Soybean oil. The background was that a few fuel plants in the US are still not able to blend and risk being shutdown with huge job losses in local areas. This spooked the markets and led to a general sell off across the board. In a year of the G7 highlighting climate change as a top priority supporting an oil industry that can't blend biofuel would seem pretty ludicrous.

Overnight the sell off in the states has continued with the discussion switching to rain coming into the wheat producing states. Before then there are very hot temperatures and a crop condition report so this will need to be weighed up on how this downward trend continues. Also will the rain come?

China has said they will be importing less soy and less corn for the coming season...is this true or is it a game, certainly the aim of controlling inflation is working, deliberate or not.

EU markets are down this morning following the sell off in the States, volume is thin and farmers may well not sell into this market.
June 07th

Market Report

Markets continued their volatile ride over last week, weather issues are the focus on corn and wheat. Overnight the US markets have seen a good rally, they are not back to their contract highs yet...Russia and the Ukraine are reporting good crops but have caused themselves issues with export taxes and traders are weary of the defaults they suffered over the last year. In addition shipping is expensive no matter what the cargo which will be having an impact on calculations.

In Europe crops look good, there were thunderstorms which damaged some wheat in France but very localised. Harvest in the UK will be delayed and this could make the July/ Aug As Av market interesting. The FAO reported the highest rise in food price inflation for the past 5years, this looks to remain until world crop supply issues settle down.
June 02nd

Market Report

Forecasts of dry, warm weather in the US for the next fortnight in the Corn Belt were enough to allow the markets to rebound. With tight global balance sheets, the slightest climatic adversity is leading to cautionary buying and extreme volatility. On the other hand, the slightest improvement also leads to profit-taking. This should encourage all to be cautious and to rely on good management.

Prices in the Black Sea basin are following the trend with good new crop demand for Russian wheat, despite the introduction of export taxes.

In corn, analysts continue to estimate a crop of 90-92 Mt for Brazil, compared to the 102 Mt reported by the USDA in May. The first harvests are beginning in the country in Parana, a state that has been particularly affected by the water deficit of recent weeks.

American market
Prices for all commodities rose sharply in Chicago yesterday as weather fears returned to the Corn Belt. Indeed, forecasts indicate dry and hot weather for the next 15 days, leading to fears of a water deficit for this water-consuming plant.

Export inspections were also at or above the top of expectations, particularly for corn, with 80.7 million bushels for corn, 9.43 million for wheat, and 7.06 million for soybean.

The markets were also supported yesterday by the equity markets and by the firmness of energy prices, gas, and crude oil.
May 25th

Market Report

Wheat markets continue to drift, EU/ UK have good rains (maybe too much), Australia is saying they have good establishment so can satisfy Asian demand. US crops continue to improve. This does not mean that we are out of the woods yet and there are still a lot of questions over the Brazilian corn crop and Russian crops. World stocks are still low, China is still buying and inflation is lurking in the major G7 countries. These factors mean the market still has upside and consumers still need to buy.

The wheat crop will be delayed in the UK and this will make the as available market pretty active. Trade estimates for the UK wheat crop mean that we will back as a net exporter, although not a huge tonnage to export. This may well weigh on prices at harvest as stores could get filled quickly.

As ever nothing is guaranteed and these markets remain volatile, Russia and China can make statements that can change the outlook in an instant.
May 17th

Market Report

Chicago is showing signs of weakness as funds and other players are taking profits.

From a fundamental point of view, few changes can be observed. However, the improvement in weather conditions in the US and France is encouraging producers to hedge at these price levels and financial operators to take profits on long positions.

On the international scene, we noted on Friday a new purchase of corn from China, 1.36 million tonnes of US origin.

FranceAgrimer posted an unchanged crop rating for wheat at 79% good to excellent. The situation is also unchanged for winter barley and durum wheat at respectively 76% and 69% of good to excellent. Spring barley has improved to 85% good to excellent from 82% the previous week. The recent rains, even if uneven, are providing some optimism for the upcoming crop.

Ukraine will experience a rainy week with between 15 and 60 mm of rain expected in the next 7 days, depending on the region. This rain is timely, more than three quarters of the maize and sunflower and 50% of the soybean crops are in the ground. This will help to compensate for potential yield losses due to the delay since the beginning of the spring. Neighbouring Romania should also be well watered along with the Russian Kuban.
May 10th

Market Report

What a difference a week makes, with the recent warm and wet weather has farmer sentiment changed on crop size and quantity?

The arrival of rain offers a reassuring factor as FranceAgriMer published lower crop ratings on Friday. Soft wheat crops are in "good to excellent" condition at 79% compared to 81% the previous week. A slight drop was also noted in winter barley with 76% of crops in "good to excellent" condition.

With the short to mid term forecast temperatures are rising towards seasonal average this along with the nitrogen uptake will increase crop yield potential.

The US corn market in Chicago ended the week on a new high above 7.70 $/bushel on the May 2021’s delivery and 7.30 $/bushel on the July 2021. New exceptional sales of corn have been announced, including 1.36 Mt of the new crop toward China. The funds’ activity remains buoyant and these actors are still strongly bullish on the cereal. This Wednesday, the USDA report could provoke some positions’ readjustments or profit takings.

The firmness is also in place on the soybean. In Chicago, current market tensions have pushed soybean prices to the highest level seen since the 2012’s summer. The soy oil and meals are also progressing to new campaign highs.
April 27th

Market Report

Will we see £200 ex farm for new crop in the next 2 weeks? This cold and dry weather around the world is going to help, but when will the UK farmer become a seller?

Prices of all-commodities continue to progress on the back of weather concerns in Brazil and USA added to a high activity from speculators.

The European crop monitoring agency has revised downwards its soft wheat yield estimate for the EU to 5.86 t/ha from 5.89 t/h estimated last month. This is a consequence of the recent cold weather. In winter barley, the European yield is also revised downwards to 5.83 t/ha from 5.88 t/ha estimated last month. Finally, in rapeseed, and not surprisingly, the estimated yield is down to 3.19 t against 3.26 last month.

Rapeseed is being pulled up around Europe and throughout the UK. French acreage is below 900,000 ha, while yields will probably be below the 5-year average. Lastly, the crushing activity remains dynamic due to skyrocketing vegetable oil prices on the international market.

American market
Another crazy session yesterday in Chicago. 8-year highs have now been reached on main commodities.

Corn plantings are estimated to be 17% complete as of last Sunday, compared to 20% for the 5-year average to date. However, the figure was within the range of traders' expectations. Soybean planting is 8% complete, ahead of the average (5%). Spring wheat plantings are 28% complete compared to 19% on average to date.

The US winter wheat crop rating fell to 49% of good to excellent from 53% last week.

Export inspections this week amounted to 564,047 t for the wheat and 1.9 Mt for the maize, exceeding traders' expectations.

Funds were once again very busy yesterday, being net buyers of about 60,000 lots of corn, 16,000 lots of soybean and 18,000 lots of wheat.
April 19th

Market Report

Corn has been the driver of the cereal complex for more than one year and planting conditions in the US added to the level of the future crop in Brazil are focussing the attention.

In France, the lack of rain predicted for 10 next days is increasing producers’ concerns. Last Friday, FranceAgriMer said that wheat crops in France are 86% good to excellent, one point under the previous week. Conditions for the winter barley degraded by 2 points to 83%. The most significant decline is seen on spring barley at 88% of good to excellent, down by 4 points from the previous week. Corn plantings are estimated achieved up to 18% on April 12 vs. 23% last year to date.

German cooperatives estimates the 2021 wheat harvest at 22.63 million tonnes and the rapeseed harvest at 3.57 million tonnes, i.e. an increase of +2.2% and +1.6% respectively.

Soybean prices record further gains in a bullish context of veg oils.

The corn retreats as funds are taking profits on their long positions after the test of the 6 $/bushel threshold on the front delivery. However, the situation remains challenging for US corn plantings with delays compared to last year and a water deficit situation in place in Brazil.
April 12th

Market Report

In France and some parts of Europe, frost damage has been reported mainly on the most vegetative advanced crops such as winter barley and rapeseed. Damage to early sown spring crops such as malting barley and sugar beet have also been recorded.

On 5 April, i.e. before the cold snap, FranceAgrimer posted a crop rating for wheat unchanged from the previous week at 87% as good to excellent. The crop rating for winter barley improved to 85% from 84% the week before, as did the spring barley to 92% from 91%. No doubt next crop ratings will fall, after taking into account last week's cold snap.

Rapeseed prices continue to be volatile with a drop linked to a USDA report deemed bearish for soybeans and a lower canola. However, for the 2021 crop, prices remain firm because of fears of further downward revisions of the European production, especially in France after the frost episode.

China sold approximately 512Kt of wheat in its state reserve auctions as of 7th April, approximately 13% of the amount offered. This is reported as the lowest volume sold this year following an easing of domestic corn prices. Dalian corn futures down 2.2% as of the end of March from beginning of the year.
March 29th

Market Report

Wheat, corn and soybeans all trading lower this morning.
Soybeans at a ten day low this morning on maintained dollar strength. We have the quarterly stocks report and prospect planting report this Wednesday. Reuters poll shows average trade estimate for wheat stocks at 1.272BBu, down from 1.415BBu Y/Y. Corn at 7.767BBu down from 7.952BBu Y/Y, soybeans at 1.543BBu, down from 2.255BBu Y/Y. Poll estimates for U.S. plantings: Corn at 93.208, wheat at 44.971, soybeans at 89.996 (all in millions of acres).

Money managers reduced the net long position in Chicago wheat futures and options last week by 9,365 to 8,160, the least bullish position held since 29th December. The corn net long was increased by 17,275 to 388,175, the most bullish position since 31st December 2010. The soybean net long was increased by 6,813 lots to total 162,853.
China sold just over 1Mt in its state reserve auctions last week, approximately 26% of the volume offered, marking the lowest volume sold so far this year on falling domestic corn prices. Dalian May contract at the lowest since late December.
Ukrainian Agricultural Ministry has lowered its estimate for 2020/21 wheat production to 24.88Mt from 25.1Mt.
The Ever Given has reported to have been freed from the shoreline of the Suez Canal.
March 22nd

Market Report

Wheat markets slipped again on Friday even after several large corn sales to China which surprised many in the trade. Corn saw a good rally but wheat did not follow suit. Oilseeds are still where the action is, stocks remain tight and shipping is causing issues.

Domestically wheat consumers are still staying out of the market and demand is thin on the ground. Wheat is still hard to buy on Farm but there are trade sellers offering wheat. As we get closer to harvest the S &D for the UK is still very hard to read on old crop.

New crop wheat has slipped on the back of the old crop but still has the potential of a greater upside as crops around the world are not guaranteed. There have been reports of wide spread flooding in Australis, NSW, this has been mostly coastal so shouldn't have too much of an impact on the cereal areas.
March 15th

Market Report

Markets continue to drift with bullish/ bearish news seemingly balancing each other out. Overnight US markets are slightly down but news is emerging that the Brazilian soy crop is now having some issues with rain delaying harvest. The beans in some instances are rotting/ sprouting in the field. This is one to watch as many analysts were pinning their hopes on a large S. American crop.

EU Ag markets are slightly down this morning on the back of US sentiment. Stg is still reasonably firm against the major seven and talk of inflation building in the economy is more prevalent.

UK domestic demand remains hand to mouth with little forward demand and few sellers. Milling wheat imports continue to come in and this is adding to the supply in the market.
March 08th

Market Report

Friday saw the markets drifting and very little news coming forward. Tomorrow will be the USDA so markets may well remain quiet in the run up to the report. Oilseeds are where the action is currently and OSR and soybeans markets are volatile with an underlying firmness. Crude oil continues to climb approaching $70bbl and this is adding a to a bullish sentiment adding to discussions around inflationary pressures in the wider economy.

In general crops in the EU are looking good and the weather pattern looks to be set fair for the coming weeks which will continue to improve conditions.

Overnight the US Ag markets were up which will provide support to French and UK markets. The dollar continues to find support against the major 7.
March 01st

Market Report

Markets remain firm but with prices up at contract highs demand is becoming limited. From a weather point of view, Western Europe is experiencing positive conditions. In South America, Brazil is facing strong rains, delaying soybean harvest works. In Black Sea, especially in Russia, frost damage has been noticed but in usual proportions for this period of the year.

Rains will stop in South America leading to harvest continuing and probably a sell off in prices due to the extra supply.

FranceAgrimer said that in France, 87% of soft wheat is in good to excellent conditions, 1 point higher from last week. This number must be compared with 64% last year to date. Winter barley is 83% good to excellent, unchanged from last week but much higher than last season (66%). Spring barley is planted up to 22% on Feb 22 vs. 17% last year to date.

Rapeseed prices retreated on the back of profit takings. Supplies remain very tight, limiting the downside potential for the moment.

American market

On Friday, last trading day of February, US markets experienced some profit takings in a volatile context. The situation remains globally unchanged; supplies are strained, especially in soybean and corn.

March is a crucial month for operators, focusing on the estimations of planted area in the USA. They should touch a record high this season, except if climatic conditions are adverse.

Friday, funds were net sellers in 4 500 lots of corn, 3 750 lots of soybean and 7 000 lots of wheat.

The week should begin on a firm tone. The economic outlook should be underpinned by the massive stimulus plan of 1.9 trillion $ to support the US economy.
February 22nd

Market Report

US Ag markets dropped on Friday, a USDA Forum highlighting a record planting season for corn and soybeans put pressure on the market, however, the market has some bullish fundamentals. The issue here is, the stocks are low and supplies will be very tight as demand increases. The world needs some good harvests to get itself back to surplus. Overnight the US markets are up but only slightly.

EU Ag markets were buoyant as supply issues still remain. The real story of last week has been the strength in STG, it continues to out perform the major 7. We are now almost 1.40 on the dollar, a level not seen since March 2018. Against the Euro, we are approaching 1.16. The vaccine roll out is the thing driving this, although without the rest of the world being vaccinated at the same level, the UK economy will hit its ceiling of growth fairly quickly and then it will stall.
February 15th

Market Report

Today is Presidents’ day with the CME and ICE New York closed, London and Paris will remain open.

Cold temperatures heading for the U.S. plains and Midwest were supportive of wheat prices towards the end of last week, while risk of a cold snap in eastern Europe and Ukraine is lending support in Europe. Around 15% of wheat crops in the eastern region are expected to be threatened by the cold, with the coldest temperatures expected tomorrow.

Brent oil is also at its highest since January 2020 at $63.4/Barrel. Growing hopes over easing of lockdowns and U.S. stimulus as well as Middle East tensions are supporting tailwinds this morning.

On Friday, traders were puzzled between taking profits before the long weekend and keeping long positions ahead the arrival of another cold snap in the US winter wheat areas.

The soybean market is still benefitting from the strong Chinese demand coupled with the late arrival of Brazilian supplies. The situation in Brazil could lead to a bottleneck in the ports in coming weeks if most of the harvest is achieved in March.

Friday, funds were net buyers in 4 500 lots of soybean and 3 500 lots of wheat. They were net sellers in 5 500 lots of corn.

The €25/t Russian wheat export tax has come into force from today.

February 08th

Market Report

London closed up Friday, May +70p (£202.50), November 21 +50p (£165.50) and November 22 +50p (£154.75) For the week, May was - £5.25 and November 21 - £1.70

US markets had mixed trading on Friday but ended the day with corn and soya slightly down but wheat up as trade prepared for Tuesdays USDA report
$ was lower and most commodities higher, oil reaching pre pandemic levels.
Only minor exports announced with corn to unknown (Japan / South Korea ?)
Fundamentals remain bullish, rain delaying Brazilian harvest and corn demand constant with US well place com supply; Chinese Dalian corn remains close to highs. However, non-commercials / speculative traders have 1.22 million contracts the highest ever level; higher even than the 2012 drought year when corn was $8.50 bushel (currently $5.48). This provides for volatile markets and sometimes trade not reflecting fundamentals
Tuesdays USDA report should be bullish with reduced stocks, South American situation and demand , but how much factored in?

US planting intentions have corn acres + 4%, soya + 1.7% and spring wheat + 2.8%; wheat area questioned as wheat price cheap relative to corn

Russia announces floating wheat tax from 1st June with 70% on price balance above $200. The base price is calculated on export prices reported to Moscow exchange, for example the current FOB price for 12.5% protein Russian wheat is $285, $285 – $200 = $85 less 70% = $59.50. Currently tax is 50% / 60% on total price

Argentina bean and soya have both been revised down 1 million tonnes each, Brazilian corn also speculated down.
Canadian stocks also lowered due to active exports with canola thought lowest since 2012

February 01st

Market Report

On Friday, China bought from the US a new record corn sale of 2.1 Mt. USA also sold 132 000 t of new crop soybean to China. The Chinese government on Friday sold nearly 2.2 million tonnes of wheat from its state stocks on its domestic market to meet internal.

During last week, more than 5 Mt of corn have been sold by USA to China, suggesting a likely upward revision of the export target by USDA in its next monthly report on Feb 9.

In Russia, following on from tariffs implemented on exports from February 15 and March, if prices continue to climb, authorities are thinking to set a tax system to limit the exports in the next season.

Russian exporters are rushing to get as much wheat out as possible before the introduction of export taxes on 15 February. In January, at least 3.3Mt of wheat have been exported.

This rate of exporting is 57% higher than the activity recorded in January 2020 but more importantly, it is higher than Russian operators had anticipated.

On a weather point of view, recent rains in Brazil are suggesting possible damages and delays in some regions as harvests are progressing.

The funds are currently holding record long positions in maize over 400,000 lots.

January 25th

Market Report

The markets started Friday in a fairly quiet fashion. The US markets were edging down throughout the day but when they opened the sell began in earnest. It became a self fulfilling prophecy as fund managers liquidated long positions in order to avoid the margin calls that were coming. Soybeans fell by $50 with wheat and corn following suit. In the wake of such a huge sell-off UK and French wheat followed suit. The question now is was this enough of correction and can the markets recover from this. On the surface it seems that the sell-off was over done, overnight the US markets have managed a small rally.

Fundamentally the markets still have a bullish edge; crops aren't in a perfect condition, stocks are low and China is still buying but sentiment can be a powerful emotion and this certainly happened on Friday. This should bring in buying interest but sellers will not be interested at these levels so the market now needs a reset.

Its a new week, traders will be assessing the Friday sell off and trying to see if emotion or fundamentals are in control.
January 18th

Market Report

After a surge in prices over the last few weeks traders are wondering if markets have reached a level where demand could slow down. Last week Egypt cancelled a wheat tender - suspected to be direct relation to current prices.

The Russian authorities decided Friday on a further action about export taxes on cereals. As a result, within the framework of the 17.5 Mt quota of cereals exportable between 15 February and 30 June, the following taxes will be applied:

- From 15 February: 25 €/t in wheat as announced in mid-December.

- From 1 March to 30 June: 50 €/t in wheat.

- From 15 March to 30 June: 25 €/t in corn and 10 €/t in barley.

In corn, planting conditions in Brazil, which contributes just over 100 million tonnes to world production, will need to be closely monitored. The most important factor disrupting global balances is the demand side, with China's appetite for both maize and soybean.
January 11th

Market Report

European prices were firm on Friday for all products due to new buying interests on the international stage. The feed barley soared, probably on the back of Chinese interests. China bought 204 000 t of US soybean and Japan 120 000 t of milling wheat sourced from the US, Canada or Australia. The Chinese government released about 2 Mt of wheat from its strategic reserves to supply its domestic market and try to curb prices’ inflation.

Argentina has lifted its ban on maize exports, but still limits its exports to 30,000 tonnes a day. This helped to ease cereals prices' rise in Chicago on Friday, but failed to reverse the bullish trend in anticipation of tomorrow's USDA report.

Friday, funds were net buyers in 5 000 lots of corn and 15 000 lots of soybean. They were net sellers in 3 000 lots of wheat.

The Black Sea basin will face an important cold snap in coming days. By the end of the week, temperatures should drop below -25°C in the Russian central district and in the Volga Valley. The snow layer should increase and reach about 30 cm in these areas.

This cold weather will also hit Ukraine, but in lesser proportions. However, temperatures should fall under -15°C. The snow protection is minimal and could become a matter of concern for the operators.
January 04th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Today is the first day back for the majority of the UK after the Christmas and New year holidays. The year 2020 will always be remembered, let’s hope that 2021 is completely different. Hopefully Brexit is now behind us and with the help of the vaccines so can lockdowns.

Dry weather in South America and continuing weakening of the dollar is helping push prices to highs last seen in 2014. Weaker dollar drove U.S. grain exports notably above analyst estimates in week ending 24th December. Argentina has also temporarily suspended export licenses for corn before 1st March to maintain adequate supplies for animal feed demand. The Argentinian Grains Unions continued to strike over the weekend.

Chinese Agricultural Ministry announces pledge to improve locally grown crop yields to help maintain local production.

Indian farmers planted 32.5MHa of wheat as of Jan 1st compared to 31.4MHa last year/ Winter sown pulses and oilseed plantings also increased to 15.5Ha and 8.1MHa respectively (rapeseed at 7.2MHa vs 6.7MHa in 2020).
December 21st

Market Report

Bull run continues to be the dominant feature for all agricultural commodities, although the market is becoming increasingly tight as the festive season approaches.

In France winter cereals are currently considered to be in a satisfactory state after favourable sowing conditions this autumn and temperatures that remain mild for the season. The US is looking towards weather issues in Brazil. Rain is needed to help soy and corn area. Long term forecast is suggesting a continued dry trend.

The major news today is the closure of EU boarders to UK trucks, after a new strain of Covid-19 was discovered in Kent. Strangely though this was originally thought to be out into the public domain in Nov. The GBP has collapsed on the back of the news, which ironically is exactly what a no deal Brexit will bring - just 2 weeks early. Brexit talks are at a 'critical' stage according to Michel Barnier whilst this may seems like a Groundhog Day, it certainly is going down to the wire. Fishing is the main reason for a lack of a deal, whilst it seems non negotiable for the UK to loose its fishing rights, as some see this as a loss of sovereignty. Time will tell if the issue of 0.1% of GDP will effect trade talks going forward, but with a Christmas holiday coming up there is limited time to continue talks.

New lockdown restrictions are growing across to the UK and around the world. This itself could be a reason to slow the market in the new year.
December 14th

Market Report

Friday saw huge rallies in the Ag markets. As ever the CBOT led the charge. Wheat rallied 20cents on the back of news that Russia was going to impose and export levy on grain exports. The UK wheat market saw its biggest one day gain in the last few years rallying by £5/mt. This increase was supported by the rapidly weakening sterling as the Brexit talks seemed to be collapsing. May 21 wheat now trading at new contract highs.

The Russian news gave the markets the opportunity to 'buy the rumour and sell the fact'. The detail of this announcement is yet to be seen and overnight US Ag markets have dropped very slightly.

Brexit continues and with it STG's rollercoaster ride weakening rapidly on Friday to rallying strongly today. This is making markets swing wildly and who knows where the talks will go as it seems the deadline is now 31st of Dec?
December 07th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Overnight the US Ag markets saw another sell off carrying on from where they left off on Friday. CBOT Wheat has now dropped 67cents in the last month. More talk of a bigger Canadian wheat crop, India looking to sell more reserves of wheat and Australia dominated. There has been a change in the law in China requiring all mid sized cities to hold enough reserves of grains to meet a set demand. This could continue to provide support to markets although it is unclear how much they have already bought and what if any these levels are.

STG has weakened as the Brexit negotiations continue to falter and confusion reigns. Not sure anyone is surprised by this, it is now all about who blinks first. Markets hate uncertainty and this is a classic example.
November 30th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Friday was a quiet day on the market with Chicago only open a half day due to Thanksgiving, however the short session ended on a positive note.

In China, cereals prices are soaring and the government sold about 670 000 t of its wheat state reserves on the domestic market. China is the main driver of the current bullish trend on agricultural prices.

In wheat, 795 800 t have been sold at the end of week on November 19, according USDA. This is well above market expectations. Same scenario for the corn with 1.665 Mt exported.

On the bearish side France wheat area should expand sharply this year and production levels should be more in line with averages. In its weekly report, FranceAgrimer said that 96% of autumn wheat is in good to excellent conditions vs. 75% last year to date. 94% of the winter barley is considered as good to excellent.

More locally we've seen an increase in winter wheat area, seed sales are much more buoyant than the rest of the Autumn with growers only thinking of one crop. If the rain comes through later this will this have an effect with on more wheat plantings? The temperatures across the UK are certainly starting to look a lot more like winter.
November 23rd

Market Report

US Ag markets are up overnight after general talk of tight stocks across all commodities, corn and soy are the commodities that have seen the most demand from China. The record rise in Covid cases in the US has caused some commentators to highlight the reduction in domestic food demand from the hospitality industry. It is still unclear what the US is going to do to combat its Covid issues at this stage.

Ukraine is completing its harvests in suns and corn and the yields have been in line with expectations. The yields are lower than last year but this was expected.

Sterling is very firm against DOLL and EUR, news of the Oxford vaccine giving the currency support.

There is still talk of dry weather in S. America effecting soybean crops and the markets will continue to watch this development closely. Australia has cut about 40% of is wheat acreage and remains on track for a bumper harvest.
November 16th

Markets Report

Overnight the US wheat markets are down with corn and soya slightly firmer. This is crunch week for the brexit negotiations with rumours that the UK is softening its stance in order to ensure a trade deal with the EU. With the PM isolating and Cummings gone Lord David Frost is out on limb and might be forced to a deal he doesn't like.

The good news is the UK has signed a deal with the Ukraine in order to allow 136,200 tonnes of low quality wheat to come in tariff free! Anything over this amount will attract a tariff rate of £79/mt. This would be a big increase on previous years where the UK saw on average 3,000 tonnes come in. How this wheat is produced is a different question. We see more and more pesticides being banned in the EU but this is not happening in the Ukraine so is this a level playing field?

Stock markets are rallying as more potential vaccines come to the fore, sterling is a bit weaker. Wheat market could be lower to unchanged.
November 09th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

So Biden has won the Presidency and with it a lot of major issues to contend with. Trump still refuses to concede but the Republican party will struggle to keep showing support for him if he makes allegations that seem unfounded. Biden will improve international relations, China might find tariffs less restrictive, the UK/ EU trade deal is in a whole new light. Barnier may become bolder knowing that the US will not guarantee a trade deal with the UK (Biden is a believer in Europe) and this could mean the UK having to accept a more EU focussed deal.

Stock markets have already reacted positively to Biden with Japans Nikkei at a 29 year high, and this bounce is being seen across other major stock markets. Overnight the US ag markets are slightly down, the dollar is unchanged to slightly firmer and sterling is unchanged. Currencies will remain volatile until Trump concedes, its the uncertainty again causing issues.

EU wheat drilling has continued apace and farmers are reporting reasonable conditions and crops looking well. The UK has some rain in the short term but again looking dry further forward.

UK ag markets will lack direction and could well be unchanged to slightly down.

author Ben Schadla-Hall
November 02nd

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

With the UK heading into lockdown, will we see a similar week to what we experienced back in March? Will we see another £14 p/t sell off? Crude oil is plunging as lockdown measures weigh again on oil consumption levels. France, Germany, UK all now fully locked-down. The fate of the US will be determined by the election result - Biden for a Lockdown and Trump against. We should know the Election result by Wednesday morning. The polls are showing Biden in the lead - this will add uncertainty into the markets. How accurate are the polls and will Donald pack his bags on Wednesday if asked to do so?!

According to FranceAgrimer, 66% of winter wheat sowings in France had been carried out by 26 October against 45% the previous week, in corn, 88% of the area has been harvested, compared to 77% the previous week and 60% to date last year. Rains in the US is adding to the pressure on wheat markets, whilst only 41% of the crop is considered good to excellent. On Friday, funds were net buyers in 3 500 lots of corn and 3 000 lots of soybean. They were net sellers in 4 000 lots of wheat.

Our view - we expect markets to remain nervous over the expectation of the US presidential election.

author: Josh Dewing
October 19th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up on Friday, May 21 + £2.20 (£187.95) and November 21 + £2.75 (161); price gaining £5+ from mid-week.
For the week, May 21 was + £2.45 and November + £3.00.
Physical supplies tight with few sellers coming forward and prices supported by firmer EU markets in wheat and corn

Despite improving weather for crops for harvest 21, wheat is stills seen as a buy
EU wheat becoming a discount to Black sea / Russian origin, especially with further talk of export restrictions in Russia pushing up prices.
French wheat 12% planted against 16% this time last year

US markets saw soya and corn down despite further sales to China. US wheat gained and is now meeting highest levels since 2014. The affects of La Nina are already being felt in South America, dry weather continues and the potential of crop is in doubt. On the other side of the World Australia are experiencing higher levels of rain that could also curb expectations.

Egypt state they have enough wheat reserves for 7 months

Chinese economy grew 4.9% in third quarter, although experts often question the accuracy of its economic data.

author: Joe Beardshaw

October 12th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat had a quiet trading day on Friday in terms of volume but, May 21 + £2.10 (£185.50) and November 21 + £75p (£158) ended the day firmer.
French markets were also up
Sterling stronger

USDA report was bearish for wheat but ignored as dry weather Russia, Brazil, Argentina and wet western Europe supported values. The report was bullish for soya with values at 4 year high and stocks 5 year low.
Soya production was reduced lower than expectation, yields kept at record levels but harvested acres reduced.
Corn similar, harvested area down 1 million acres, trade expectation 200,000 reduction.
Danger for soya and corn bull markets, driven by fund buying and creating huge longs, at some stage the funds will sell / profit take.
Demand for soya into China remains strong, especially with US beans at a big discount (80 cents) to Brazilian origin.

World wheat record production at 773.08 (up 2.59 mmt), demand 751.03 (from 750.09) and stocks at 321.5 mmt.

Wheat imports into UK 218,000 tonne in August, Bulgaria and Germany were the main suppliers but Canada largest supplier for season so far.

Argentina is the first country to approve a GMO wheat variety that is drought resistant.

author: Joe Beardshaw

October 05th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London November 20 closed down 85p Friday (£182.50) and November 21 was down 25p (£156), Nov20-May21 carry is still inverted, physical markets are firm on the spot price.
For the week, November 20 was – 25p and November 21 + £1
French wheat eased after recent rally but good demand, bullish USDA report and weather limited falls.

US market mixed with many markets (Dow, oil ) reacting negatively to news of president Trumps infection
Corn down but soya supported by higher meal prices due to good demand and limited supplies with Argentina imposing export taxes

Wheat supported by dry weather in Russia and Ukraine. Some rain forecast for Russia but Ukraine may miss out.
Milling wheat prices up 40% this year (25% September) in Ukraine with higher bread prices causing domestic unrest; Russia has hinted at export restrictions to protect domestic supplies.

Australia may produce 30 mmt with 18 mmt available for export but this could be absorbed by good demand.

author: Joe Beardshaw

September 28th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London November 20 closed £182.75 (+ £1.25) and November 21 unchanged at £155
For the week, November 20 + £2.50, whilst November 21 was – 50p
November 20 getting technical and May 21 is trading at parity to November with no carry
Sterling slightly stronger

French wheat prices range bound at present but with UK domestic prices at premium to French there could be increased imports; German quality wheat continues to be imported
French prices can compete with Russian due to the rise in Russian prices; German wheat may gain trade into Pakistan and Algeria taking it away from Russian origin

IGC reduces global corn crop by 6 mmt to 1.16 billion due to reduced yields in US, China and Europe
Wheat kept same at 763 mmt
EU maize crop reduced by 1.8 mmt due to dry conditions; France 15% of maize harvest complete.

US markets are quiet with no new export sales announced, apart from meal, there had been 14 days of continuous soya sales previously and funds remain long with danger they have overbought and may want to reduce exposure
Markets under pressure as Brazil are forecast to have record corn crop of 110 mmt (area up 6% combined increased yields) but, with only 20% planted, favourable weather will be required.

author: Joe Beardshaw

September 21st

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat continued to follow Paris and US markets up
London November 20 closed up £2.05 (£179.25) and November 21 + £1 (£155.50)
For the week, November 20 + £2.25 and November 21 + £1 as recent rises cancelled mid-week losses

Russian wheat prices were stronger due to weaker rouble and lack of sellers coupled with good demand.

French maize 4% cut (1% last week) with 59% rated good to excellent (60% last week)

US corn, soya and wheat continued to rally with funds, so far, maintaining long and resisting profit taking.
China strong buyer of US soya, US origin discount to Brazilian; estimated China well covered Oct, Nov, 80% Dec and 50% Jan but, demand may increase as Chinese crops damaged by typhoons and flooding.
Trump announces $13 billion support for farmers affected by Covid; level of support will be based on yield and prices

Dry conditions are beginning to concern new crop in Russia, Ukraine, Argentina and Canada.

author: Joe Beardshaw

September 15th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

UK London wheat has started the week lower, down £1.50 for Nov20 and down £1.00 for May21 for most of Monday’s session, however contracts closed only down c.50p. Last week, London wheat increased by c.£8, mainly on the back of weaker sterling and currency seemed to be the cause of Monday’s lower prices.

UK wheat imports have significantly increased, up by more than 50kt same time last year (July 19’ -July 20’), this is not surprising due to the difficult harvest and lower yields leaving consumers to buy non domestic crop.

Friday’s WASDE report did not have many surprises, no change for Russian or Ukrainian production estimates, the USDA maintained its estimate of 78Mt for Russian wheat production, however other sources estimate production closer to 82.5Mt. EU production has been raised by 650kt, this could be due to a better than expected German crop. Both Australia and Canada had upwardly revised production figures; Australia are expected to increase potential exports with China but may come under greater scrutiny at the ports due to tariffs implemented in May.

OSR came out bullish from the report, there are concerns over production of the next rapeseed harvest in France. It is expected that the potential area could be less than 1 million ha in view of the persisting dryness.

China have continued to buy and in particular US soybean.

author: Joe Beardshaw

September 07th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up 25p November 20 (£169.75) and down 40p November 21 (£151.60)
The carry on the futures between November and May21 is down to £3.50 (normally £6)
Traders predicting sterling will fall having reached 8 month against $ ($1.34) as Brexit and virus affects economy; sterling may recover end of year

French wheat exports outside EU at 4 year low despite increased volume to china; reflection lower / poor wheat crop and cheaper competition

US markets had soya and corn up but wheat was down
Soya supported by further export sales to China and Philippines
So far this season, US corn exports total 9.56 mmt compared last year 941,000 and soya 20.8 mmt compared last year 3.4 mmt
US soya c.62 cent discount to South American origin
Funds long and with soya values reaching technical resistance levels, some analysts predict values are overdone
Brazil anticipating (January) record bean crop of 130+ mmt, weather permitting, which will compete with US
USDA report due Friday which will provide an update on crop conditions

Central Argentinean wheat area has had some rain but damage has occurred

Ukraine grain exports predicted 57.2 mmt from previous 56.5 mmt

French corn ratings 61% good to excellent from 62% last week

Bulgarian wheat crop down 24% to 4.6 mmt due to lack rain

January – August Egypt has bought 80% Russian wheat compared 50% last year

September 01st

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat will have a shorter trading week due to the Bank Holiday but catching up on last week, London wheat closed up on Friday, November 20 + 25p (£169) and November 21 + 70p (£152.45) making gains for week £2.75 and 85p respectively.

French markets closed down yesterday but in general have been supported by Chinese buying, shipments estimated to be by the end September 1 million tonnes. It is thought that after September China may switch to US and Canada; Baltic, Poland and Black Sea still the cheapest origin

Markets conflict, bearish and bullish:
Bearish - big crops in Russia, Australia and Canada (Canadian wheat + 10.5% (35.7 mmt) and IGC increasing world wheat production and stocks in 2020 compared 2019
Bullish - smaller EU crop, Chinese demand and lack of sellers as many domestic markets are competing with export values.

It is predicted up to 300,000 tonnes of German quality wheat will be imported into the UK (German wheat crop down 5.1% at 21.88 mmt) as millers are concerned about UK supply and quality. In 2019 1.05 mmt of wheat was imported, Canada supplying nearly half of this total.

US markets supported by dry weather and continued Chinese buying.
Soya price has moved from the low levels seen in August to now at 2 year high in cash markets, funds are long soya
Whilst world wheat fundamentals are bearish, markets remain robust, funds are short, there could be short covering in wheat markets unless sentiment changes.

author: Joe Beardshaw

August 25th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down yesterday, November 20 – 10p (£166.15) and November 21 - £1.20 (£150.40), however the market opened and traded C.£1 higher for most of the day. Over last week, November 20 was + £2.65 and November 21 + £1.90.

French wheat reached 3 week high due to demand for French grain from China, it also resisted bearish factors from increased Russian wheat crops and the expectation of large Australian and Canadian crops; analysts / technical traders commentating support at 182.20 euros and resistance at 184 euros.

Support in the market came from potential weather related problems in Argentina and French maize ratings good to excellent fell from 65 to 62 over the week (similar rating to this time last year)

Russian wheat exports increase with greater tonnage coming forward. 2020 estimated production figures have been varied but recent information has indicated that crops in Siberia, the largest producer of spring wheat, are in the worst conditions since 2012.

During July, China bought just under 1 million tonnes of wheat, up 325% year on year, biggest suppler was Canada with 36%

US markets saw corn up on dry weather concerns but wheat was down
Funds are long soya despite a large crop looming; some doubt USDA forecast, yields are too high after recent weather
US corn and soya is cheapest origin so should gain whatever demand appears

author: Joe Beardshaw

August 17th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up on Friday 75p November 20 (£163.70) and +45p November 21 (149.70). London wheat didn’t quite see the same level of momentum as experienced by the French market, even though 685 lots went through in four AAs on May21, which skewed the day’s volumes. Trading was stronger towards the end of the week, Nov20 managed to finish £1.05 higher on the week.
Today has so far seen increases of between £1.80-£2.00, on the back of weather concerns in the US.
The UK’s harvest was said to be 47% complete on Tuesday, after rapid progress for the preceding fortnight, says the AHDB.

French wheat closed at a 2 week high, largely due to technical buying and dry conditions in Argentine wheat areas and buying demand eg Egypt.

Egypt again bought Russian wheat, Russia and Baltic states cheapest origin and could take some traditional French wheat homes such as Algeria.

German wheat crop a reasonable 21.48 mmt and Poland up 5% compared 2019 at 11.75 mmt.
French corn rating down 65% good – excellent, down from previous week of 74% as hot dry weather impacted crop.

US markets mixed; some traders questioning USDA corn acres, saying they could be overstated by 1 million acres.
The Derecho / hurricane storm last week did some crop damage, 14 million acres in Iowa suffering, damage yet to be assessed.

Japan, the World’s third largest economy, announces 7.8% GDP fall in April – June, this would equal 27.8% drop for year if trend continues: Japanese economy was struggling before pandemic pressure.

author: Joe Beardshaw

August 10th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down on Friday, November 20 – 90p (£162.65) and November 21 – 50p (£149.25); for the week November 20 - £3.25 and November 21 - £2.60. Nov 20 opened this morning slightly higher, only to then fall away by £1.25, market has marginally recovered but still 90p down from the open.

Sterling value has gained nearly 0.5% against Euro.
Debate continues about UK wheat crop, highly variable yields but 10 – 10.5 mmt seems the average.
Whilst still plenty of samples to come in, spring barley looks to be struggling on quality and yield, apart from in the south, however small premiums make long haulage not viable.

French wheat harvest 99% complete, spring barley 83% complete. Even though information is suggesting small French, UK, Romanian and Bulgarian crops, markets still have fallen as other producers anticipate good crops. Canada predicting record wheat crop and Russia increase production, Australia also having a potentially large crop.
Germany is 80% harvested, having seen good yields that are compensating smaller area and could be only .5 – 1 million t below last year.
Maize beginning to feature, French crop ratings are down 3% on week (77% to 74% good / excellent)

US markets are down as good weather and expected high corn yields are forecasted from record area; stronger $ due to better employment data and increased tension with China have all exerted downward pressure.
USDA report this week is anticipated to be bearish; USDA report is not done by field walking but grower surveys, satellite pictures etc, so results can be unpredictable.

author: Joe Beardshaw

August 03rd

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

November 20 closed up 5p (£165.85) and November 21 + 20p (£151.85) making the weeks movement - £2.90 November 20 and - £1.65 November 21. Today the markets have so far traded lower along with French Matif, circa £1.80 Nov20 and €1.50 Dec 20.
French wheat trade was fairly flat last week, very little news to provide the market with direction.
French wheat harvest 90% complete from 71% last week; Maize rating good to excellent 77% from 80% last week

Sterling stronger against € and $

Ukraine’s grain export figures were a third lower in the month of July, down to 2.33 Mt, this included 1.19 Mt of wheat, 424 Kt of corn and 714 Kt of barley.
US grain closed slightly higher but trade is quiet. Biggest gain was soya oil, which is at 5 month high, giving greater incentive to crush demand
Despite huge corn sale to China, markets appeared to ignore the news as big crop looms
$ poised for biggest monthly drop in decade.

External markets trading sideways, apart from gold close to an all-time high reflecting investors nervousness

Australia anticipating 26.5 – 27 million tonne wheat crop, biggest since 2016 but plants entering critical stage.

author: Joe Beardshaw
July 27th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London Nov 20 wheat closed up on Friday £1.50 (£168.75) and Nov 21 + £1.15 (£153.50); for the week, Nov 20 was unchanged and Nov 21 + 25p
UK early wheat yields reports adequate with growers relieved and quality good and usable; first spring barley from south, reports are very good yields, early days for both though.

French wheat up due to firmer US markets, tighter supply but not helped by stronger Euro.
At this time of year there is normally aggressive selling from the Black sea but sellers throughout Europe are reluctant.
Weather for Europe this week generally beneficial for harvest, with only light rain forecast.
French wheat crop good to excellent goes to 57% from 55% as harvest moves north and better crops
71% harvested

US corn and soya slightly down whilst wheat gained; weather remains beneficial to crops.
Markets helped by weaker $ as FED plays it soft with low interest rates in an attempt to try and support economy; $ down 6 days in a row.
Soya supported by 9th consecutive report on export sales.
US / China political tension increases with military exercises off Taiwan however China continues to buy,’ watch what they do not what they say’

Argentinean wheat crop suffering dry conditions and debate about autumn weather and ‘La Nina’ effect

author: Joe Beardshaw

July 20th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed unchanged November 20 (£168.75) and down £1.10 November 21 (£153.25), over the week November 20 was + 25p and November 21 - £1
Sterling weaker currently £ / euro 1.0947 / .9135p

US markets were quiet but high temperatures are causing some concern.
Vegetable oil is stronger as rain in India, Malaysia and China has pushed up palm oil combined with firmer mineral oil. US / China trade war rhetoric continues, however there are signs of some progress on Phase 1 of the trade agreement..but total package has yet to be signed!

French wheat 47% cut against 11% last week, winter barley 90% cut against 65%, spring barley 22% against 10%
Corn 82% good to excellent down from 83% last week compared 75% this time last year. The pace of the French harvest seems to be faster than last year, this time last year only 26% of the crop had been gathered.

Ukraine grain production put at 68 mmt compared last year’s record 75.1 mmt

author: Joe Beardshaw

July 14th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down yesterday, November 20 - £1.60 (£166.90) and November 21 - £1.35 (£152.90), over the week, down by c.£1 on Nov 20 and Nov21.
Sterling was weaker but external markets exerted pressure; sentiment not helped by a prediction that a second wave of Covid 19 virus maybe worse.

French wheat, having reached 7 week high, also fell due to stronger Euro and profit taking; crop reports are of big variation in yields. Germany having rain but crops not suffering yet.

Early UK barley yields are down c. 15 – 25% and quality very variable reports of a single field of craft producing nitrogen results of between 1.64 – 2.01. Very early days but nitrogen higher than last couple years, however grain size is encouraging.

US markets are all down as better weather for corn pollination and soya crops dragged down wheat.
Monday’s USDA crop report didn’t show a great deal of change from last week, only a marginal drop in good conditions for corn, soy and wheat.

IKAR Russian consultancy firm reduced wheat crop to 76.5 mmt from 78 mmt; yet Russian prices still fell.

Ukraine has harvested 6.34 mmt grain from 1.9 million hectares including 2.92 mmt wheat and 3.03 mmt barley
Total grain estimated 68 mmt compared 75.1 last season.

Friday’s USDA report saw a 2020/21 world wheat production number of 769.31Mt, almost 4Mt less than the June WASDE with reductions coming from the EU, Russia and the US. This 20/21 production number less China and India gives a number of 526.13Mt which is 5Mt less than 19/20 rather than 2Mt above.

Egypt world’s biggest wheat buyer announces it has enough wheat for 5 – 6 months consumption having included 3.5 mmt domestic supply

author: Joe Beardshaw

June 29th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London responded to external markets, closing down on Friday; -15p Nov20 (£163) and -35p Nov 21 (£150.40). The total for the week was November 20 - £2.55 and November 21 -£1.10
Sterling slightly weaker, however potential ‘face to face’ Brexit negotiations may see currency swings influencing wheat market.

Paris wheat set new 3 month low despite EU reducing wheat crop by 4 mmt, down 10.4% compared last year, big global wheat crop looms, Black Sea region, especially Russia, have increased forecast.
French crop ratings are generally unchanged: wheat at 56% good to excellent, winter barley – 1% (51%), spring barley 54% and corn 83%.
French barley harvest has started with mixed reports as worst fields cut first. Russian and Ukraine barley harvest has reported lower yields than last year but better than anticipated as these were weather affected regions.

US markets are down, mainly due to good weather (sun and rain) and increased virus cases; southern states have been significantly impacted by increased number of cases.
Reports of soy bean cargos being exported to China but not enough to challenge bearish sentiment.
Fundamentals are bearish, funds have large short in corn and wheat but any bullish factor could have frantic short covering

author: Joe Beardshaw

June 22nd

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up on November 20 + £1.35 (£165.85) and November 21 + 50p (£151.50) but down on the week by c £1 on both Nov 20 and Nov 21.
French wheat also closed up after recent falls.
Sterling down as borrowing levels and economic recovery did not make good reading; public debt now exceeds economic output for first time since 1963, when World War 2 was still being paid for.
Rain in Europe consolidated crop condition but reduced crop size is expected and next 7 day European forecast looks very warm.

French wheat ratings are stable for the third week running, wheat 56% good to excellent, winter barley 52%, spring barley 54%, maize 83%, all unchanged from previous week.

US markets had corn and soya up but wheat is down.
Chinese trade talks in Hawaii have been well supported, China pledging to honour phase 1 agreement and buy corn, ethanol and beans.
Wheat is down as winter wheat harvest progresses, although rain in Kansas
Vegetable oil up as crude prices increase, economy improves and China and India low on stocks
Soya spread above corn increases and with big corn crop due this may extend further
Next USDA report 30th June will give stock numbers

World wheat stocks are looking to reach a new high by mid-2021, this is with or without the inclusion of Chinese production. Chinese stocks continue to increase, it will be the eighth consecutive year of producing more wheat than it uses. It is also a point of note that production increases are largely not coming from the northern hemisphere exporting nations.

author: Joe Beardshaw
June 15th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up on Friday after 5 consecutive negative closes over the week; November 20 + £1 (£168) and November 21 +10p (£152.25) both positions down £2 for the week. Most of Friday’s trading went through marginally higher than open value (£167 – 167.50) and only trading higher on the close, prices were largely helped by weaker sterling and firmer external markets.

Paris wheat also up after reaching 1 month lows but, market found technical support and crop potential is a matter of conjecture.

Last week, USDA report estimated UK wheat crop at 10mmt, down 38% against last year’s 16.2 mmt. Global wheat carry out stocks are at new record levels, however most of the increase comes from China and India and this stock rarely moves abroad into the international open market.

French wheat ratings are the same as last week: 56% good to excellent, winter barley unchanged also 52%, spring barley 54% from 55% and corn 83% down 85%. Last year, wheat was 80% and current ratings are at lowest level since 2011.

Russia raises its wheat forecast and Ukraine raises corn crop. Russia continue to push exports even when wheat stocks are at a 7 year low…cash…oil?

US slightly up but trading is quiet. Funds are heavily short on corn, crop conditions are benign, current weather continues to be favourable, will they maintain a short position when July corn up 20 cents from low?
Dow recovered from Thursday’s beating.

author: Joe Beardshaw

June 08th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down Friday with November 20 -£1.75 (£170) and November 21 – 50p (£154.25) to bring total wheat values down £4.30 and £2.35 for the week respectively
French wheat down c. €1.50 for the week
Stronger Sterling but still slow progress with Brexit; current domestic prices make imports viable and maize is relatively cheap
Much needed rain for Europe but will this be damage limitation or yield improvement?

French crop ratings are stable but at 9 year low, soft wheat and winter barley same as last week at 52% good to excellent with spring barley down 1% (55%)
Dry weather has seen crops ahead in growth stages, predictions of harvest, could be, 1 – 2 weeks early.
French export volume down to 5 month low.

US saw corn and soya showing small gains but wheat down.
Markets had seen rises, market shorts reduced positions as weather improved.
Better than expected employment data gave economy boost.

World wheat production cut by 4 mmt to 758.3 mmt, but still above 2018 crop and with demand reduced, stocks forecast to increase

Ukraine grain planting 98% complete at 11.33 m hectares

April saw lowest UK barley demand for brewing, malting and distilling for 10 years and down 28% year on year.
Rain helps crops and with big UK spring barley area, quality is the big unknown

China wheat harvest 50% complete (11.33 m hectares), yields generally favourable and 98% crop harvested by machine

author: Joe Beardshaw

June 01st

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Last week London wheat saw significant gains; Nov20 was £4.65 higher and May21 £4.75 higher. So far this week, London wheat has opened lower and presently C.£2 down on the November 20 contract, possibly on the back of potential showers towards the end of the week. Whether we see the rain or not the market is nervous and will continue to react aggressively.

Sterling has firmed up against the US dollar over the last few days, GBP against the Euro is stronger today but has weakened over the last few days.

Matif milling wheat has not seen the same level of support as London wheat with a wetter forecast for the Black Sea region and Western Europe, as well as the lack of any real export demand. However French soft wheat crop ratings declined slightly last week to remain at their lowest since 2011 for the time of year, data from farm office FranceAgriMer showed, as weather turned dry again. For the week to May 25, 56% of soft wheat was rated good or excellent against 57% the previous week, FranceAgriMer said. That was the lowest score for the period since 2011 when the good/excellent score was just 24% at the time of a severe spring drought.

The European Commission made a sharp downward revision to its estimate for EU-27 common wheat production in the 2020/21 season, lowering the estimate to 121.5Mt from 125.8Mt last month, this represents a reduction of 7.1% in common wheat production Y/Y. German gross production is estimated at 22.1Mt (11.7% below five year average) compared to 22.9Mt, reflecting the less extensive damage to German wheat crops.

EU OSR forecast has again been cut, giving an estimated to 16.68MT, this will be the fifth time and the smallest crop since 2006/07. It is expected the demand, albeit reduced due to the coronavirus impact, will be largely covered by imports from the likes of Ukraine, Australia and Canada. Canada’s exportable volume to the EU may be limited by the concern of GMO regs.

US / China trade has become fractious due to US accusations, China have told their state buyers to hold off buying from the US.

The US is generally seeing good crop conditions, giving a bearish feel to prices. US weather forecast has very warm to hot temperatures in the Great Plains early this week and the warmth will expand into the Midwest for a while during mid-week, but temperatures may not be quite as hot as far to the north as once expected. Midwest will experience better late season planting conditions over the next two weeks and warm weather will promote aggressive crop development. Delta and southeastern states will see a favourable mix of rain and sunshine over the next couple of weeks

author: Joe Beardshaw

May 26th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

The May 20 contract expired on Thursday. November 20 closed down 80p Friday (£169.75) and November 21 + 70p (£152.70), gains for the week were significant on November 20, up £4.55 and November 21 + £1.55. November 20 did reach £171 Thursday.

Sterling unchanged but may come under pressure as UK economy forecast to shrink 17.5% this quarter, previous prediction 13.1%, but next quarter growth / bounce of + 11.9% predicted due to relaxation of lockdown restrictions.
Bank of England will have to give financial impetus, such as quantitative easing, but markets do not anticipate negative interest rates.

Wheat markets were down as rain expected Germany, Poland and southern Russia but overall yield estimates are down due to the irreversible damage caused by the dry conditions.

French crops improve: wheat 57% good to excellent from 55% last week, winter barley 52% from 51% last week; spring barley 58% from 62% last week; maize 93% planted with 86% good to excellent from 87% last week

Ukraine are close to their exportable wheat quota for the season, leaving 200k mt to be exported between now and 30th June. Ukraine government have warned traders that if exports are exceeded there will be a ban, this may not have a fundamental significance on stocks but the notion of a ban would cause concern in the markets.

US markets are mixed, corn up but soya and wheat down. Good planting progress and corn emergence ahead of 5 year average, few crop concerns as beneficial weather is forecast; USDA crop report due Tuesday

Egypt has 2.86 mmt wheat, bought against 3.6 mmt demand with reserves for 5 months

author: Joe Beardshaw

May 18th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London May wheat contract will expire this week, volume has been non-existent and values have been inferred but closed unchanged at £154.50. November 20 wheat closed up on Friday £1.30 (£165.10) and up on the week £1.40 however and November 21 closed the week up on the day but down 30p on the week (£151.15).
Sterling lower for 5th consecutive day, currently Euro almost worth 90p; sterling damaged by little progress with Brexit negotiations and economic data.
European wheat supported by forecast of dry weather and little rain

US markets slightly higher but fundamentals remain bearish. USDA WASDE was bearish; weather forecasts remain generally favorable for the U.S., crop progress and conditions report today.

Oil up due to increased industrial activity in China during raising hopes for corn / ethanol demand.

French crops again downgraded, wheat 55% good to excellent (last week 57%, last year 79%), winter barley down to 51% from 53% and spring barley down to 62% from 64%.
Maize crop 90% planted.
German wheat production forecast down 2.9%

Ukraine have reduced export estimates for the coming season due to dry weather and lower planted area; barley exports possibly down 23.4%, wheat – 17.5%, corn – 1.8%

India having bumper crops, wheat production estimated at 107.18 mmt and rice 117.94 mmt these are close to record figure; India is the World number 2 rice exporter.

Economic impact very serious, Japan and Germany being classified as in recession after two quarters of negative growth. US economy shrank 4.8% in the first 3 months of 2020, the biggest contraction since the ‘Great Depression’, China was down 6.8%. Some analysts are pessimistically forecasting 30% contraction in US in the coming months.

author: Joe Beardshaw

May 11th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat market was closed on Friday but gains for the week; May 20 +£2.45 (closed at £153.45), however this contract is soon to expire and values are becoming more technical, November 20 closed + £3.40 (£163.70) and November 21 + £3.70 (£151.45).
Weather continues to dominate sentiment, trade is searching out any new updates on regions with rain or lack of! Reduced rain forecast for S Russia, Ukraine and the Balkans. Strong winds will also be contributing to dryer soil moisture levels.

Sterling was very slightly firmer, Bank of England resisted further stimulus measures warning biggest economic slump expected for 300 years. Economy in April – June to shrink 25% and unemployment reach 9% but economy forecast to bounce 15% in 2021.

US markets modestly higher but it was a quiet trading week.
Support from freezing temperatures in the mid-west and further trade talks with China viewed as positive.
Dow was up despite unemployment numbers, which were not a bad as anticipated.
USDA crop report Tuesday, this will also cover stocks.
There are big ranges for corn carry out tonnage and planting acres estimates, clarity on these could give market direction but it is predicted bearish.

Ukraine has completed 86% of spring planting intentions. It has been estimated that the spring drought has caused 2.6% crop losses, especially for OSR and wheat.
2019-20 saw exports of all grains up 19% from previous year (51.47 mmt), this figure is projected lower for 2020-21

Saudi Arabia triples vat from 5% to 15% to counter lost oil revenue.

author: Joe Beardshaw

May 04th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down on Friday, May 20 -£1.20 (£150.30), November 20 - £0.95 (£160.30) and November 21 - £0.75 (£147.75). Both old and new crop lost c.£4 over the week.
Currently sterling weaker than Friday levels.
Rain in Europe has diluted some of the weather concerns but medium range forecast is not indicating much rainfall, recent rain has been a major reason for the drop in wheat prices and will continue to drive the market.
Market unpredictability indicated by Warren Buffet lost £40 billion first quarter of this year with Berkshire Hathaway by investing in airlines

US markets are down as tension remains between US and China. US July corn futures tested contract low support mid last week and uncovered substantial short covering and commercial buying interest. The contract lows suggests that $3.09 is a major support point going forward. Weather impact reduces bullish influence.

IGC reduced world wheat by 4 mmt to 768 mmt, consumption estimated up 6 mmt at 766 mmt; but with carryout stocks increased by 6 mmt to 289 mmt, wheat supplies are plentiful.
Corn production estimated 1.157 billion tonnes with consumption put at 1.1738 but, with ethanol demand for corn uncertain, this figure is likely to be reduced and there is also plenty of carryover stocks

author: Joe Beardshaw

April 27th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London May 20 wheat closed down on Friday £1.25, £156.10; November 20 down £1.50 at £167.70 and November 21 £1.50, £152.10. However, London Wheat still posting gains on the week, May 20 £7.10 higher and Nov20 £3.45 higher. The main focus has been the weather and continues to bring volatility to the markets.

Sterling currently unchanged against euro but, slightly up against $.

Rain is expected for Western Europe and Poland, if this also reaches Black Sea and wheat growing regions of Russia, it will put further pressure on global wheat markets, this impact has already been seen towards the end of last week when rain was forecast.

Possible Russian export restrictions are continuing to provide fuel to increase prices but there are questions if this is overdone due to potential rain.

US prices are lower as markets take a time out; corn near to $3 and funds are short, how much more can it fall? Any change in weather, legislation and travel would make an interesting market.

Weekly French crop ratings fell again, wheat 58% good to excellent (61% last week), winter barley 57% (60% last week), spring barley 69% (78% last week ), and maize crop 52% planted.

Ukraine grain production may fall to 60 mmt, last season 75 mmt, a number of factors directly and indirectly to blame: weather / economy /virus, however prices may be supported by talk of export restrictions.

Argentina forecast to harvest record wheat crop, growers switching to wheat to avoid possible soya export tariffs.

author: Joe Beardshaw

April 20th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London May futures closed down £2 on Friday (£149) and £9.20 down on the week, November 20 closed up 30p (163.80) but, £5.20 down on the week. Old / New crop spread is gradually improving the viability to carry stock. May 20 futures contract will turn technical as the FND is Friday 24th. London November 21 also +30p (£148.80).

Markets continue to react hope v’s pessimism over virus situation.
Sterling currently 1.1482 / .8709p against € and 1.2481 against $.

US markets also mixed but US oil price reaches 21 year low as demand reduced and storage limited for ‘glut’; this is despite OPEC cutting production by 10%. Ethanol production, intrinsic to oil, has been a vital source of demand for U.S. corn ever since the Renewable Fuel Standard (RFS) came about in 2005, which mandated the use of renewable fuels in transportation fuel . Almost 40% of yearly corn use in the United States is devoted to ethanol under normal circumstances. Feed and residual use also typically account for nearly 40% of annual U.S. corn consumption, while exports take up only about 15%.

Significant rains are forecast in parts of the US that will hold up potential fieldwork in the Delta and Southern states. Also, other areas experiencing below average cold weather.

French wheat rated 61% good to excellent (last week 62%); spring barley 78% (last week 84%), Maize 25% planted.

French wheat supported by Egypt buying 180,000 French wheat Thursday (also 60,000 Russian) but, domestic demand has reduced and end of season stocks are forecast up. There is demand from Jordan and South Korea but this is likely to be South American corn

Russia will suspend grain exports until July 1 if its exports quota, set at 7 million tonnes for April-June, is depleted earlier, Oksana Lut, the Deputy Agriculture minister, told reporters on Friday. The quota is currently expected to be depleted in mid-May, and there are no plans to increase it, Lut said. If Russia's grain exports are suspended, there will be no exceptions for certain companies, she added.
Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

author: Joe Beardshaw

April 14th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat only saw marginal gains over last week, closing up 40p on May 20 and 85p higher for Nov 20. The present old crop/ new crop spread has increased to C.£12.

GBP has strengthened over the Easter break, this will be negative to UK wheat exports. Consumers will have an eye on cheap imports, this will give some level of resistance to new crop prices going up and may see old crop also come under pressure.

Concerns of dry weather are drawing the trades focus away from currency and back to the fundamentals. Areas of Ukraine and southern Russia are experiencing 20% less than normal rainfall and continue to support the European market. This lack of rain may be ease in the next 10 days but, until confirmed, eyes will be firmly fixed on the Black Sea region. French wheat has been trading at contract highs, a reflection of the fundamental situation. However, the global outlook for wheat production remains positive at this present time.

The UK and France are expected to see some rain towards the middle of the month, but limited to 0.5 inches, this is due to a MJO weather event, possibly too little too late!.

An agreement to the crude oil production war between Russia and Saudi Arabia has been met, during the period we have seen some of the lowest oil prices in the last 18 years. As yet, oil prices have not significantly reacted; the relationship between crude oil and rapeseed (biodiesel) is very significant. With oil prices remaining at these historic lows, the competitiveness of biodiesel and therefore European rapeseed remains significantly dampened.

author: Joe Beardshaw

April 07th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat futures were down on the previous week C£3.50 -£4.50 on May and Nov contracts respectively, however opened this week higher for both old and new crop. May 20 / Nov 20 has increased it’s spread, presently C. £11, this is increasing the opportunity to carry wheat into next year. London wheat May20 is down 3.80 on the week whilst Nov20 settled 4.45 lower on the week.

GBP was relatively stable compared to the previous weeks but, depreciated towards the end of last week, this benefited London wheat futures.

French soft wheat condition rated good to excellent has dropped from 62% to 63% week on week, this is well below last year’s rating of 84%.

Last week it was announced the Russian government’s April – June 7Mt grain export quota had been approved. This is unlikely to have an impact as this is what they would have been likely to export in this period anyway. The agriculture ministry, which has 1.8 Mt of grain in its stockpile, had previously planned to sell 1 Mt from it; in total, it is planned to send up to 1.5 Mt of grain to the domestic market to meet the needs of the flour and bakery industry, as well as the livestock industry.

CBOT Corn is heading towards it’s lowest levels in more than a decade, this has been related to the reduced bioethanol demand caused by restrictions borne out of the coronavirus. Between 40 -60% reduction in bioethanol demand, depending on location in US, has led to C. 7MMT of less corn required. Cost of corn production against value is nearing it’s bottom line and will potentially see fewer acres planted.

WASDE report this coming Thursday.

_Joe Beardshaw

March 30th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Last week, London wheat went through a rollercoaster ride on prices; early in the week the price shot up by £7.30 followed by significant drops and only to finally end the week 60p up on May 20 and £1 up on Nov 20. Most of this volatility was attributed to currency, fundamentals will continue to be the main focus but currency is having greater influence than usual.

UK old crop wheat is trading at a significant discount to French wheat, however new crop Nov 20 is at a premium to Matif, this will potentially hold down UK wheat as imported wheat continues to be competitive.

According to Agrimer, French spring barley drilling had accelerated last week. Overall, 72% of drilling is now complete compared with 40% previous week and 97% at this point last year.

Dry weather across western Europe has aided drilling and with this dry spell expected to continue into early next week. Conditions of French crops have remained stable this week, 63% in good to excellent conditions, compared to 85% at this point last year.

The International Grains Council published a revised estimate for global grain production yesterday. The IGC has projected a record production level in 2020/21 of 2.2 billion tonnes (Bt), up 2% Y/Y.

US wheat was up on the week, however Corn continues to be under pressure, mainly due to the reduced demand in Bioethanol.

The last day of March can be one of the year's most volatile sessions in the ag markets, largely because of the planting intentions report from the U.S. Government.

Oil prices continue to drop as coronavirus ravages economies around the world. The price war launched by Saudi Arabia almost three weeks ago after talks with Russia over price stabilisation broke down has sent prices to their lowest level in 17 years. The Brent crude price was around $65 per barrel at the start of January.

author: Joe Beardshaw
March 25th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

UK May and Nov wheat had big gains on Monday but the market has lost some of that increase on Tuesday, net gain C £4. May 20 wheat £163.50, £8 gain over the last 4 days of trading, Nov 20 £173 £5 gain over the last 4 days of trading.

GBP is having a recovery, this may curb continued wheat gains.

Matif wheat has continued on an upward trend over the last 5 days, increasing by C €8 but has dropped by €2 on Tuesday.

Malaysian palm oil futures climbed as much as 4% following the news that three of the major producing districts had a number of employees testing positive for Covid 19, this bolstered gains in other oils. EU rapeseed imports have totalled 4.75Mt so far this season, a 45% increase Y/Y. Concerns still remain over demand for the oilseed in the coming months in regard to the demand for biodiesel, as well as cooking oil. With restaurants now closed across Europe demand for cooking oil will be signi?cantly impacted.

U.S. ethanol producers are on track to shut about 2 billion gallons of annualised output by the end of this week because of a slump in demand for fuel, the head of the Renewable Fuels Association trade group said.
Biofuel producers are feeling the impact of an energy industry in crisis as countries including the United States take unprecedented steps to contain the coronavirus pandemic, curbing demand for products such as gasoline and jet fuel. –RFA spokesperson said ‘it looks to us like we’re nearing 2 billion gallons of capacity on an annualized basis that was operating as recently as a month ago that we think by the end of this week will be offline’.

Markets were temporarily spooked by an announcement from Russia regarding the suspension of grain exports but, later it was clarified only relevant to processed grains, such as buckwheat.

US weather is forecast to be wet for the coming spring, if this is correct, it will mean another difficult corn planting period.

author: Joe Beardshaw

March 16th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

UK May 20 wheat closed up on the week C. £2 and £1 up on Nov 20.
Matif May 20 wheat dropped €1 over the week but has continued to fall today.

Crude Oil took significant losses early on in the week and losses continued through to Friday but closed slightly up on Friday night.

Matif Rapeseed futures have dramatically dropped again following energy markets and ‘panic sentiment’ surrounding Covid-19 pandemic. A small consolation is that the blow has been mildly softened in respect of UK physical rapeseed values by a significant fall in the value of Sterling. At this stage it is very difficult to assess the S&D’s, but the funds are simply taking a ‘risk-off-approach’ and selling, though the drops are more pronounced as the market is seeing very few buyers.

Currency has been a leading factor in market movement recently; Sterling weakened by more than 3.5% over the last 5 days. The USD rallying again on Friday putting further pressure on US ags that were trying for a recovery in the overnight session.

Not surprisingly Coronavirus has dominated the news and influenced the markets.

author: Joe Beardshaw

March 09th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

UK May and Nov wheat closed down on the week C.£2, and has taken another drop in this morning’s session, presently May 20 £147 and Nov 20 £157.50.
Matif wheat closed the week C. €2 down but has taken a significant drop of €4 this morning. However, 20/21 harvest has been revised and due to the recent rain has led to a reduction in forecasted yield from 7.34 to 7.25t/ha taking 340kt off production to 33.44Mt (39.57 Mt in 2019/20).

US dollar has weakened, sterling has also come down but is only slightly lower over the week.

USDA WASDE report tomorrow, general sentiment is bearish but we will have to wait and see!

Goldman Sachs and other major banks such as Morgan Stanley have cut their demand growth forecasts, with Morgan Stanley predicting China will have zero demand growth in 2020. Goldman sees a contraction of 150,000 bpd in global demand.

Crude Oil has had one of its worst falls on record, down 34%. OPEC had decided to curb oil production but Russia announced it would continue at present levels. Saudi Arabia have now decided to increase production in an effort to punish Russia.

author: Joe Beardshaw

March 02nd

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down on Friday, May - £1.20 (£149.05), down £3.70 for the week; November -70p on Friday (£159.30), down £1.95 for the week.
Sterling is down as trade talks with EU and US making little progress; currently £ / euro 1.1605 / .8616p and £ / $ 1.2822.

All commodities, including gold, have suffered from virus effect; Brent crude trading below $50 for first time since December18.
Dow jones fell 16% for the week
Markets have seen a slight rebound as central banks pledge support; oil back now $50+

US grain markets have been under pressure but they have not suffered as much, soya and wheat closing slightly up, corn slightly weaker.
Some analysts think soya is overdone, funds heavily short (beans and meal) and China is due to allow tariff free purchase (if they buy in current circumstances??). Argentina has reported to have imposed export tax, there could be short covering.

Latest French crop assessments has soft wheat 64% good to excellent, down from 65% last week, lowest rating for 9 years.
Winter barley also down 1% to 66% (last week 67%) against 80% last year.
Spring barley planting now 32% from 20% previous week; this time last year 66% planted.

author: Joe Beardshaw

February 24th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London May wheat closed down 75p on Friday (£152.75) and down £1.50 on the week.
November 20 closed down 50p (£161.25) down 75p for the week.
Little change for Sterling since Friday.

US markets for corn, soya and wheat all weaker but with mixed outlook.
Latest USDA estimates have increased corn stocks and big planting estimate, weather permitting, creating a bearish view.
Lower Soya stocks and the anticipation of increased China purchases have supported prices but US will face stern competition from South American origin, especially with weak Brazilian Real.
US wheat is bullish, wheat stocks are at lowest level for 6 years and winter wheat area lowest for 100 years, unharvested corn preventing spring wheat planting.
Trump tweets about increased aid for farmers which could further increase corn area.
Markets have been overshadowed by continued coronavirus fears that it has paralysed the Chinese economy, signalled by falling oil prices as demand is curtailed; African Swine fever is still a problem but Covid19 virus making the headlines.

French winter wheat rating remains the same as previous week, 65% good / excellent
As of Feb 17th, spring barley 20% planted, up 4% from previous week.

Canadian exports have been disrupted by protests and creating big backlog.

author: Joe Beardshaw

February 17th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

May 20 London wheat closed up 25p Friday (£151.75) but down £2.50 for the week, November 20 closed up 70p (£160.30) but down £1.75 for the week.
Sterling unchanged but, Brexit negotiations have not been helped by negative comments from French foreign minister Jean- Yves le Drian saying ‘trade deal unlikely by end of year’.

French wheat is in the worst condition for 8 years, at this stage 65% good – very good against 85% this time last year, the area is already down due to planting disruption; EU wheat crop estimated -5%.
French winter barley is rated 67% good – very good, 79% last year; Spring barley as of 10th February 16% planted.

US markets are slightly weaker.
Coronavirus continues to be a concern, 64,000 infections and 1,400 fatalities reported.
South American weather continues to boost crop potential
$ stronger not helping exports
Rumours are that China has bought 500,000t corn from Ukraine.

World’s third largest economy Japan has reported poor economic data.

author: Joe Beardshaw

February 10th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up £1 on Friday, May closing £154.25 (up £2.50 for the week) and November £162 (up £2.20 for the week).
Sterling, very slightly weaker.

US corn, soya and wheat all closed slightly up. US corn is cheapest in global markets and caused some fund shorts to cover position.
US wheat is up on rumours that China has bought French wheat (8-10 cargoes) and may come for US supplies; French exports to the Far East are already progressing well.
Beans are up in a hope that China may buy, phase 1 deal probationary period due to expire 15th February when buying may occur; bean exports up 6% year on year.
US market rises have been restricted by stronger $ but, it is seen as a safe haven reference to coronavirus market nerves.

Brazilian Real is at it’s lowest level since September 18th 2019; weaker Real is causing the Brazilian beans to be even cheaper, added to which they have an anticipated record crop.

The EU’s top wheat destination Algeria has approved Russian wheat on quality, enabling potential Russian imports.

OPEC wants to cut oil production as price falls due to reduced Chinese demand, Russia has not said it will follow but, will announce policy in the next few days.

author: Joe Beardshaw

February 03rd

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

UK May wheat ended the week down £4.25 (£151.75) and Nov wheat down £5.20 £159.80, present UK markets have opened lower.
Downward pressure on domestic wheat due external markets, fundamentally UK has new crop support with a much reduced wheat crop but alternatives can feature e.g. imported corn.
Sterling having biggest weekly gain since mid-December as UK departs EU and interest rates kept on hold, however Sterling has started to weaken on the back of initial trade talks.

US markets are generally down, especially wheat, trends / technical analysis turning bearish and wheat was ‘overbought’. Corn is supported, US corn is the cheapest available origin before South American crops become available; exports picked up overall lagging 33% year on year.

There is still a big global wheat crop and US wheat will struggle to compete unless fundamentals change; weather?

Soya has fallen 89 cents since Jan 2 high, demand has been curtailed by coronavirus and swine fever.

Coronavirus impacting on markets, Shanghai stock market falling 9% before recovering. Virus has upset expected Chinese soya purchases following signing of phase 1 trade agreement.

Russian wheat crop forecast to be close to record, area has increased and if yields match 5 year average possible wheat crop of 79.5 mmt; present Russian wheat crop potential ‘good’ but spring will be critical period.
Government aided plan had seen 932,000 hectares abandoned but land has been brought back into grain production (2017)

Oil down as US stocks higher than anticipated

author: Joe Beardshaw

January 28th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down 70p yesterday, May 20 closing £155.25 and November 20 £164.30
New spell of wet weather stifles selling pressure as uncertainty of next 2020 crop prevails
Sterling shows little movement with Brexit due this Friday.

US markets are down as virus turns sentiment negative, emotional markets tend to be volatile ones!
Deaths attributed to virus now pass 100 but, to put things in perspective, 1% of world population is 75 million, health fear dominating sentiment.

EU wheat exports are up 69% year on year, top sellers are France, Romania and Germany and top destinations Algeria, Saudi and China. Saudi buys 900,000 tonnes of barley for shipment March – April but, not impacting UK barley markets.

Weather will continue to be an important factor, world wheat stocks are reduced but still above 10 year average.
EU and Black sea account for 33% global wheat production and EU third biggest.
Wet weather in western Europe (France 410 mm rain September – December against 10 year average 260 mm) has seen winter wheat plantings down 5%, smallest crop forecast for 17 years. Western Europe shortfall is compensated by increased area in Russia and Ukraine but, some areas are dry; spring weather will determine if area becomes production reality.

author: Joe Beardshaw

January 14th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat futures closed up £2.65 for May 20 (£156.25) and up £1.65 November 20 (£164.55), it did actually trade slightly higher before retreating, volume relatively light.
Physical prices have not followed futures, buyers have ignored the rise, they are not under pressure to buy.
Rise attributed to continued wet weather hampering planting, 10 mmt being forecast for 2020 UK wheat crop, although late planting and spring wheat could make 11 mmt harvest.
Prices also boosted by weaker sterling, poor economic results have increased the expectation of a rate cut.

US markets continue to digest USDA report, corn marginally up as stocks reduced and review of unharvested acres in northern states planned, funds have moved from slightly short to now slightly long, reflecting sentiment.
Soya and wheat weaker as no new news appeared.
Markets waiting to see trade deal details, when and if it is signed.

Poland, EU’s biggest poultry producer, reports new outbreak of bird flu on goose farm.

author: Joe Beardshaw

January 09th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat has continued to climb on yesterday’s gains, May 20 closed up 50p at £152.75 and November 20 + 30p at £161.30.
Physical sellers still slow to appear.
Sterling not really moved
Talks between Prime Minister and EU President have differing views on whether trade deal is possible by December 2020!

US markets are mixed.
Soya and corn recovered as ‘risk market subsided’. Markets appeared to calm down, it was viewed that Iran had ‘stood down’; Dow Jones much firmer.
Corn broke technical support trend lines; poor exports not helped by China announcing it was scrapping plans to incorporate 10% ethanol blend.
USDA report due this Friday, trade expecting acres, yield and carryout to be lowered for both corn and soya, depending by how much will determine whether report is bullish / bearish.

Oil values are down as Middle East tension is perceived to be reduced but, whole situation very ‘combustable’!

author: Joe Beardshaw

January 06th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down 75p, May 20 £152.75 and November 20 £162.50.
Sterling, slightly weaker, currently £ / euro 1.1919 / .8553p and £ / $ 1.3082
After last week’s interrupted trading days, this week the market conditions might get back to normal!

US markets went sharply lower caused by a selloff in stocks and commodities reacting to recent Iran situation.
Soya and wheat was overbought so there is an expected correction ahead of this week’s USDA report.
March beans are at present c. $9.41, technical support at $9.30, if broken the next resistance is $9.15.
USDA report is expected to cut corn and soya yields, combined with the signing of phase 1 of the US - China trade agreement will support bullish sentiment. However counter to this, record South American soya crop (6.6 billion bushels?) and increased US soya area is fuelling bearish argument.
Yet to see how much trade Chinese trade deal will actually create?

Weather in Ukraine remains warm reducing lack of snow and winterkill threat

Oil prices surges due to middle east tension

author: Joe Beardshaw

December 30th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

May 20 London wheat closed down £2.25 Friday (£151) and November 20 down £1.20 (£162.05); the change for the week, May 20 down 50p and November up £1.55, but worth noting all on thin volume.
Currency slightly weaker , currently £ / euro 1.1705 / .8544; £ / $ 1.3115
UK new crop is at a small premium compared to Paris wheat.

US markets saw wheat gaining as ‘row’ crops stagnate.
Increasing belief that wheat maybe the benefactor in Chinese trade deal, swine fever has reduced soya demand but wheat still sought after.
US wheat exports c. 1.5 million tonnes over last 2 weeks, this is the highest volume for 6 years, although world wheat still showing heavy stocks, Chinese stocks a matter of debate.
USDA report due January 10th this will define yield and production; bigger area of corn planted and better than anticipated yields after difficult growing season could see corn production not reduced, as some anticipated.

Sterling has started the week stronger against the $ and € but on thin volume and counter to the impact that was seen after the European chief Ursula Von der Leyen spoke to press about the UK intentions on Brexit.
Euro has been supported by short covering but EU economic growth is predicted to be slow.

Russian wheat exports down 13% year on year

author: Joe Beardshaw

November 28th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed slightly weaker yesterday, May 20 closing at £150.75 and November 20 at £156.55
Sterling is stronger and not helping UK wheat in export markets; whilst UK wheat price is competitive, there is a lack of demand at present
French new crop wheat now at parity with UK new crop.
French wheat reached 1 month high before falling, French rail strike could hamper exports and like UK farmers, French are reluctant sellers as planting problems continue.

US markets down as US prepares for Thanksgiving holiday.
Soya reached 2 month low
Some analysts feel US markets have limited down side as much of the bearish news is factored in.
Beans oversold and exports up year on year; hope Chinese trade deal may be signed before new tariffs due December 15th although US support for Hong Kong protesters will not help.
Argentina has new government and may impose export taxes on December 6th
Corn has struggled for demand but, there is still a substantial area of corn still out in the field.
Corn exports has been lost to Ukraine but now US corn cheaper than Brazilian origin; funds heavily short
US has struggled to compete with South American supplies, this is due to currency, Brazilian Real down 13% for the year and Argentine peso down 35% so far this year.

author: Joe Beardshaw

November 20th

Market Reports

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London May wheat closed up 75p at £151.75, November 20 was down 45p at £157.30. The spread between old crop May 19 and new crop Nov20 is c.£6, this is not enough to cover cost of storage and finance and does not make it viable to carry old crop into new. UK new crop wheat is trading at a higher level than French wheat and therefore uncompetitive in export market.
French wheat up c.€ 2 on old crop as export demand helps sentiment.
Relatively cheap maize overhangs the market but UK wheat not featuring in export mix
UK planting progress is regional specific however current weather allowing for a lot of activity

Sterling uncertain of direction whilst election in progress; financial analyst forecast sterling $1.10 - $1.45 range until result known (currently £ / $ c. 1.29)
Yesterday betting odds pre debate were, conservative majority 4/9, conservative minority 6/1; labour majority 6/1, liberal democrat majority 200/1, with conservative – labour coalition 300/1
Most seats, conservative 1/20, labour 10/1, liberal democrat 50/1

US markets were slightly firmer.
Wheat up due to lower winter crop ratings and rail strike in Canada increasing hopes for exports, also French wheat firmer
Corn harvest 76% complete against 5 year average of 92%; corn crop unknown with still considerable quantity in field which may not get cut until later / at all?

author: Joe Beardshaw

November 05th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat started the week up, May + 15p ( £146.35) and November + £1.05 (£153.55)
Sterling slightly weaker as polls indicate reduced Tory lead; indications are, it is a difficult to predict the result, there is the threat of another unclear majority, leaving the UK in the same present situation!

Brexit extension gives opportunity for continued exports but wheat may feature more than barley.

US markets are weaker, $ stronger despite recent Fed interest rate cut (0.25%); third cut this year.
Better weather is helping harvest and rain in Brazil is helping crops, US exports are lagging.
2020 could see record US corn area of 94.5 million acres, whilst winter wheat lowest area for 110 years…possibly?
US farm bankruptcies are up 24%, highest level since 2011, an estimated 40% farm profit based on subsidies (trade aid, insurance, disaster payments etc )

Attention is switching to 2020 crop, Russian wheat area could be 16.3 million hectares, up 400,000 from last year’s record area; condition and crops are good so far.
Ukraine suffering dry conditions; 2019 crop saw Ukraine grain yield up 8.3% at 4.7 t/h compared year on year.
French wheat planting progress by 28th October was 58% complete compared to 70% this time last year.
UK well behind on planting, some predictions of 14 mmt wheat crop are optimistic? Maybe too early to predict.

In current circumstances, an increase in UK spring barley area is fundamentally bearish but, it could be supported by stronger feed values due to reduced winter drilling and the question of whether quality can be as universally good again?
Still the unknown of Brexit and export business, how will UK feature?

Egypt, at latest tender bought, Romanian, French and Ukrainian wheat; Russian origin too expensive in comparison.
Since July, EU wheat exports 18.84 mmt (last year 5.9 mmt), Romania number 1 followed by France.
Barley exports up 37% at 2.57 mmt
Corn imports + 19% at 6.76 mmt

author: Joe Beardshaw

October 15th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London November wheat closed down 25p at £135.50 but, the November position is getting ‘technical’ and May 20 closed up 65p (£144), November 20 + 95p (£147.80).

Trade dominated by logistical headaches, ports are busy trying to execute sales by end the of October; weather and a lack haulage is not helping the situation.

US markets mixed, wheat and soya up but corn unchanged
Surprisingly, corn is not reacting to weather issues; crops in north west plains have been lost by weather affecting immature crops.
Soya continues to climb on the back of trade talk hopes; is it coincidence China wants some agreement as Brazilian soya values reach 2019 high as supplies get short
Markets not helped by stronger $, lower oil and stock prices

Russian spring yields better due to weather. Russian winter wheat yield estimated 3.52 t/h ( 5 year average 3.65 t/h), winter barley 4.18 t/h (4.09 t/h), spring wheat 1.74 t/h (1.62 t/h), spring barley 2.26 t/h (2.15 t/h), corn 5.51 t/h (4.92 t/h)

Swine fever continues to spread, South Korea employing snipers with thermal Imaging to eliminate feral pigs crossing from North Korea

author: Joe Beardshaw

August 13th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions

London wheat closed down £2.75 (November 19 £143) as extremely bearish USDA report caused markets to crash

USDA report was described as ‘report from hell’. Funds were long corn and the bearish report triggered a major sell off with corn limit down 25 cents.
Corn area put at 90 million acres, only slightly down from July figure of 91.7 million acres, which was severely doubted, and yield and stocks increased to complete the rout.
Report numbers still questioned, for example, the intended corn area in March was 92.8 million acres and yesterday’s report had prevented / unplanted area at 11.2 million acres so how can corn area be 90 million acres? Total corn, wheat and soya acres put at 212.3 million acres against 226.1 in 2018.
Questions will continue to be asked, the next major factor will be yield surveys in September.
Report was possibly bullish beans but corn markets dragged everything down.

President Macri defeated in elections, he was pro market and Argentinean government could return to interventionist policies.

UK harvest continues between rains but concern increasing about quality of malting crop

author: Joe Beardshaw

August 06th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

November London wheat closed down £1.15 at £144.80
UK not really featuring in export markets and with big predicted wheat crop where will it go?
Barley has active export programme with reasonable demand also helped by lower maize prices
Sterling remains weak as Brexit deal progress appears unlikely and economic data negative as consumer spending hits record low

US markets opened lower before recovering
Corn bounced off resistance levels of $4.06; corn not so dependent on Chinese trade
Trade war intensifies with China instructing state buyers to stop buying US commodities
Danger trade war becomes a currency war with Chinese yuan reaching lowest level against $ since 2008 (c. 7 yuan / $) leading to Trump accusing China of currency manipulation to make their goods cheaper in export markets
Trade war and currency knocks stock markets
Markets uncertain of next week’s USDA report with wide range of predictions; corn area forecast as low as 83.5 million acres lowest since 2006 (previous USDA report 91.7 )
With funds long corn any bearish news could lead to volume selling
Weather appears to be ignored

Russian wheat crop reduced by state consultancy agency to 75.5 mmt from previous 76.4 mmt
Rain in some areas delaying wheat harvest but benefiting spring crops –maize and sunflowers

French oilseed crop estimated 3.6 – 3.8 mmt which would be 26-32% below 5 year average

Frost in Argentina possible threat to wheat crops

UK spring barley producing big yields and good quality but weather forecast could pose problems with rain threat of pre germ etc

author: Joe Beardshaw

June 11th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

November London wheat closed down £1.95 yesterday (£151.15).
Sterling weaker (currently euro 89p) due poor economic figures (GDP and factory production) and continued political manoeuvring; if politicians cannot agree on leader, how can they agree on Brexit?
Rain raising UK crop prospects for wheat, 15 mmt?
US markets have been giving UK market direction but when they harvest and the US production is known, our harvest will be complete!

US markets finished on a strong note, small gains as funds reduced positions pre USDA report and trade tension with Mexico has receded.
USDA report due today combined with planting progress report. June report tends have little market impact but due to delayed planting it might be a different story; corn and soya production will be a guestimate due to uncertain acres, pre report talk is of very significant corn production reduction but less so for later drilled soya.
Cooler weather now slowing crop development, July corn at $4.12, resting on 2018 high.

Ukraine wheat harvest starts in c. 2 weeks, wheat yields forecast 4.15 – 4.2 t/h (last year 3.7 t/h).
Talk of heat in Russia lowering production but wheat crop of 80 mmt is still substantial and above last year when they dominated wheat export markets.

author: Joe Beardshaw

May 30th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London November wheat closed unchanged (£155.50) although did trade £4 up at one stage before retreating as US markets fell. So far UK wheat trading has seen little change from last night’s close.
French wheat prices were down.
Recent volatility has provoked some buying but not in export markets, although we ‘should’ be price competitive.
Sterling remains largely unchanged as Brexit saga continues; UK car production halved due to Brexit and slowing Chinese demand.

Market direction / sentiment dictated by US markets.
Corn and wheat fell yesterday as profit taking took place, providing a correction. Overnight CBOT corn and wheat have recovered slightly but wait to see direction when US markets open.
Fundamentally nothing has changed, corn planting report for May 26th only 58% complete, below trade estimates. Wet weather continues to hamper planting progress and the next seven day forecast has much of the same, only slightly drying out in some states.
Brazilian corn exports in May doubled the April figure, high prices and weak Brazilian currency provided stimulus.

Conflict of opinion and sentiment, US markets firmly bullish but countered by prospect of big European and Russian crops.

author: Joe Beardshaw

May 28th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London November 19 wheat closed up on Friday at £151.75 and has opened higher this morning.
French wheat markets were open yesterday and traded higher.
Sterling close to unchanged despite election results and continued political turmoil.
European election results were mixed, nationalist gains in France, Italy, and Hungary; will this have negative impact on euro?
EU – Italian dispute continues, EU possibly imposing 3.5 billion euro fine on Italy for not reducing debt, deficit should be below 3% of GDP and debt under 60% of GDP; EU has never fined a country yet.

US wheat and corn markets closed higher Friday as wet weather continues, corn 65% planted by Sunday and US farm package not fully understood.
Grain futures up 11% so far this month; funds remain short but it should be noted, South America have large corn crops and weak currency making them aggressive sellers, farmers selling to get finance.

Chinese corn futures highest level since 2015 as deficit increases, production reduces and demand increases. Corn area down as growers switch to other crops and swine fever reduces meal demand but increases corn demand for alternative meat products.

Debate over size of Russian crop, some forecasts suggesting 80+ million tonne wheat crop. Agricultural ministry predicts 75 million ton crop due to problems in Volga valley, previous 78 mmt.
USDA has 77 million tonnes estimation, 75 million would still be second ever biggest crop.

author: Joe Beardshaw

May 13th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat fell on Friday £1.05 (£141.70) as global grain markets suffered post USDA report; November wheat down £2.05 in last seven days.
Sterling unchanged as Brexit negotiations continue, apparently cross party talks unpopular with both sides!

Bearish USDA report, US corn stocks projected at 32 year high. Corn planting progress is behind plan, the extent of this will be known from today’s USDA progress report, although better planting conditions expected. Corn acres to are expected to increase if conditions permit; growers feel corn is a better option than soya with continued Chinese trade dispute and soya demand reduced due to swine fever / pig culled. Corn demand is forecast to increase; growers can switch to later planted soya if weather prevents corn planting. China more positive on trade talks than US.

Global wheat markets are under pressure, Russian wheat forecast up 7.4% (77 mmt) and EU up 12% (153.8 mmt), exports also predicated up 13% (27 mmt)

Sentiment strongly bearish but still plenty of time / weather to impact……

author: Joe Beardshaw

April 11th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

May 19 London wheat closed up 70p (£163.80) and November 19 closed down 30p (£145.80)
Sterling currently not reacting to Brexit being extended to October 31st, leaving before this date is possible if parliament agrees!

US markets quiet post USDA report, corn and soya fractionally up but wheat fractionally down. Corn markets look negative, plentiful stocks, slow exports and big south American crop; hope rest with US-China trade agreement progress, China who ‘could’ buy 20 mmt US corn. New crop planting will be held up due to blizzards, in some parts up to 24 inches of snow

Whilst not yet critical, there are dry conditions in parts Europe. French rainfall down 19% since September 1st against average rainfall and temperatures + 1.5C above average,
French wheat exports are progressing well, undercutting Black Sea prices has meant that French wheat stocks could be lowest for 10 years.

Oil did reach 5 month high, US stocks lower than anticipated and production problems in Venezuela and Libya, however demand could reduce if global economy slows.

author: Joe Beardshaw

April 01st

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat was down £1.05 May 19 (£163.50) for the week and November down 75p (£147.50).
Sterling still worth c. 86p against euro as Brexit farce continues, although currency traders think Prime Minister May is positive for sterling, ‘best of a bad bunch’, and any threats of resignation weakens sterling.

UK wheat trade remains insular, old crop expensive compared to French and new crop can be bought cheaper from Baltic, Danish, Black sea, tariffs excluded. Maize remains cheap, maintaining pressure on wheat.

US markets closed down, pressure exerted by corn. USDA report had corn stocks lower but not as much as anticipated, however potential area increased. Report was neutral soya and slightly bearish wheat. Corn may find support, significant amount of acres are yet to planted due to wet conditions. Funds are short and could lead to covering position but fundamentals are bearish.

Chinese trade talks need to make real progress to help markets / exports but, swine fever in China is reducing demand.

Reports predict Russia could have record grain crop, increased area and good conditions but dry spring is a real yield threat, however good snow cover will supply moisture when it melts. Russia continues to be a dominant force in global wheat export market.

Ukraine has some dry concerns, some areas only having 60% expected rainfall in March but, as with Russia, melting snow will help moisture deficit.

French soft wheat rating down to 78% good to excellent and winter barley 75% good to excellent.

author: Joe Beardshaw

March 18th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up on old crop, May 19 £162.55 and new crop +35p, November 19 £148.35, for a change, old crop + £3 and new crop + £2.25 for the week

Fundamentally nothing has changed, Brexit stagnating and sterling virtually unchanged. UK government announced proposed tariff schedule in a no deal Brexit scenario. There will be zero tariffs and no trade rate quota system (palm oil and coconut oil will face tariffs) meaning the UK market would be open to all global exporters, UK having previously had protection from EU tariffs and TRQ trade barriers.

US markets up; markets finding support with funds in a short position, weather uncertainty could provoke short covering as they feel unsettled with current positions.

French soft wheat rated good to very good, down 1% on the week (85% from 86%) but this is still above this time last year when 80% rated good t very good.

author: Joe Beardshaw

March 08th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat again closed down as bearish factors / sentiment weighs on markets. May 19 London closed down £2.20 (£159.50) and November 19 closed down £0.90 (£145.50)

Sterling gained, despite Brexit, as ECB announced no interest rate rises until next year, slow growth predicted in 19 countries in Eurozone. EU economy struggling and central bank also offered cheap loans to try and stimulate economy.
Brexit struggles on with EU officials pessimistic the deal will be backed by parliament but, with deadline approaching, it is high stakes poker.

US markets were down, there was a significant selloff in corn and wheat markets. USDA report due today anticipated bearish supply / demand and disappointing export figures are expected with Brazil / Argentina production up.

Latest estimates for 2019 global wheat crop put at 757 mmt at present there are few crop concerns, Russian wheat crop put at 75 mmt possibly 80 mmt, if conditions permit. But there is still a lot of weather to come and very rare there are no threats before harvest.

With all current estimates / forecasts in place, what else can emerge to fuel bearish argument?

Chinese exports down 20% in February compared last year (predicted 4.8% decline), growth slows as tariffs exert influence, and Asian stocks down as result. Decline partly explained by Chinese lunar new year holiday but still lower than expected

Rumours of UK millers trying to buy German milling wheat before March 30 deadline. Tariff threats have paralysed UK trade ,although we struggle to compete on price. Will tariffs be imposed with UK net importer?

author: Joe Beardshaw

February 22nd

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

For a change, London wheat closed up yesterday, May 19 + £2.15 (£166.50) and Nov 19 + £1.90 (£149.90).
Sterling unchanged (£ / euro 87p) as Brexit doldrums continue.
Nominally, export levels up on new crop but no trade taking place until tariff situation clarified.

US markets up due to optimism created by trade talk progress, speculation that an agreement would be reached with China to buy additional $30 billion of soya, corn, wheat ‘on top of pre trade war levels for period of memorandum. Agreement is not confirmed or signed but it helped corn and spring wheat bounce off the lows. Today will see export figures published

Oil slightly down as US production reached record levels and stocks increased.

Egypt bought Russian , Ukraine and some French wheat at recent tender but US origin did not feature.

author: Joe Beardshaw

February 19th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat was mixed yesterday, May 19 down 80p, closing at £167.35, whilst November 19 closed up 20p at £150.35.
This time last year, on the 19th February 2018 the May 18 futures were £138.65 and November 18 closed at £142.95, Sterling against euro was 1.1299 compared to 1.1421 currently.
Sterling almost unchanged yesterday as political upheaval continues and Brexit impact unknown; manufacturing / closures threats are a reflection of car the general health of the industry or Brexit, possibly a combination?

US markets were closed yesterday for a national holiday and UK half term meant there was little trade taking place. Trump tweets about progress in US – China trade talks.

UK old crop remains at levels that makes exports not viable maybe reflecting supply tightness; next 2018 harvest figures due out 27th February, markets never really reacted positively to downsizing of crop, based on reduced area, price has fallen c. £5

World prices are down, under pressure from lower French and Russian prices, although matif did bounce off the lows.

Weather favourable to crop development in Russia and spring drilling progressing well in France, 3 Black Crows

author: Joe Beardshaw

January 24th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London old crop closed down 65p and new crop down 95p, making November discount to May £17.80.
Sterling gains strength, now just below 1.15 against euro. Option of Brexit delay gains greater weight; economists predict no deal is more damaging to the economy than ‘May’s’ proposal.

Since consolidation of UK merchant trade (Frontier & Fengrain, ADM & Gleadell) it is estimated 64% UK grain will be in the hands of 3 merchants.

US markets mixed; corn had up / down day but remains above trend line, beans recovered from Tuesdays losses as rumours of trade talk cancellation with China unfounded and Brazil is hot and dry again. Wheat gained as HRW wheat now cheaper than Russian origin but, heavy stocks and resistance levels could see only 20 cents per bushel on upside. Speculation over acres planted wheat down?, soya up?, corn uncertain?

French wheat is presently cheaper than Russian, subject to freight, competition also coming from Argentina into North African markets.

Oil is down but is in the balance as OPEC cuts production and US shale boom losing momentum countered by reduced world growth. 2019 has so far seen oil prices up with Brent gaining 15% this year but 30% below the 4 year peak reached in October.

author: Joe Beardshaw

January 22nd

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up 85p. Sterling maintained levels as Brexit situation / outcome continues to be interpreted in varied ways. UK wheat should be competitive in small boat trade, subject currency, but there are a lack of buyers. Feed barley trade almost totally neglected as corn remains cheap.

US markets closed yesterday for Luther King day. Reports of seven vessels carrying 455,000 tonnes of US soya loaded and heading to China, but government shutdown makes it difficult to confirm.

Russian wheat prices reach 4 year high as stocks reduce. Up to 10th Jan, Russia had exported 24.7 mmt wheat, two thirds of the anticipated total for season. Russia could lower rail tariffs to protect domestic supply, helping grain movement.

EU wheat exports are down 27% year on year, 8.96 mmt v’s 12.2 mmt this time last year with France shipping 4.47 mmt; barley only down 0.6% year on year. Wheat imports into EU up 45%, Russia is the biggest supplier at 2.89 mmt. Cheap corn from far Eastern Europe/ ex Soviet block has seen imports increase 48%.

IMF forecasts drop in world growth to 3.5% in 2019 (October forecast was 3.7%), reduction due to trade disputes and Brexit cited but IMF is an European funded organisation.

Egypt indicates it will make immediate payment for wheat imports rather than previous 180 days, this should reduce import prices.

author: Joe Beardshaw

January 03rd

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up 70p yesterday, but on thin volume. Sterling fell against euro and $ as chances of No deal Brexit deal increased.

US markets up, especially soya, as dry weather impacts Brazil and assumption of exports increased, but government shut down has meant no official data available. Technically, soya finding support from trading in an ‘ascending triangle’ where each low is above the previous low; however there are still plentiful soya supplies.

Both oil and stock markets reached their peak on October 3rd, since then, DOW Jones has fallen 15% and oil 40% due to world growth concerns, is this the market low? The danger is, grains have fared well in comparison and could provoke index fund selling, unless threats to production threaten abundant supplies.

Russian wheat exports accelerated first half December, but are expected to slow.

author: Joe Beardshaw

December 21st

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up £1.05 old crop and up £0.55 new crop but on thin volumes.

US corn and soya down, wheat fractionally up. Despite positive corn export sales announced to Mexico, corn is down as ethanol demand weakens and external markets imposed pressure.
Stock markets and oil fall due to a combination of reasons: world economy slowing, $ up as fed raise rates, threat of possible government shut down, and arresting Chinese nationals for hacking doesnt help trade relations!

EU cuts wheat stocks by 5.9% to 11.2 mmt but corn up 19% (22.7 mmt) and barley also up 19% (5.4 mmt)

German winter wheat plantings estimated up 4.6%, rapeseed down 25%, and winter barley up 13%.

Egypt buys Romanian and Ukrainian wheat at latest tender, no Russian origin for first time in 6 months. Tighter supply has seen Russian prices increase; supposed meeting between Russian government and exporters due today.

Argentinean wheat prices up despite harvest, possible reason due to tight supplies.

Algeria looking to buy wheat and Tunisia may be looking for barley, this could possibly help UK barley prices.

author: Joe Beardshaw

December 17th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London maintained its rise on Friday, bringing weekly gains to £4 on old crop and £2.90 new crop wheat.
Sterling had a volatile week but closed at similar levels to the start of the week. Brexit progress stumbles on; EU reluctant to give further concessions, many of the current EU leaders remember giving Cameron better membership terms to win referendum, which did not succeed!

US markets were quiet on Friday but, closed slightly down on the week.
Markets, especially soya, had been rising in anticipation of Chinese business, however whilst China did buy nearly 2 million tonnes soya, this volume was seen as disappointing.
Chinese corn production is the lowest for 4 years, there maybe demand for corn imports and added to Chinese relaxing import duty on US autos, this might be an indication of ‘relaxed tension’. China did however still produce substantial corn crop and area was cut to try and reduce stocks.

General markets had negative sentiment towards the end of the week, stocks / equities weaker, oil down, concerns about global economic growth (incl China), stronger $.

Strategie Grains predict EU wheat production for harvest 2019 at 5 year high, 147 mmt, up 13% year on year and largest since 2015.
UK forward wheat prices highest since 2013/14 and 15% above this time last year, despite increased EU production and Brexit uncertainty.

Russian domestic wheat prices increase as supplies tighten and weather hampers shipping; a Russian ministry meeting is planned for this week and the export programme is on the agenda.
Russian wheat cargoes have problems in Vietnam due to weed contamination.

Argentina reduce wheat crop estimates.

Christmas week can often see some dramatic movements in markets with lower volume meaning markets can be ‘bullied’.

author: Joe Beardshaw

December 12th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down 60p yesterday. Sterling remains c. .9050p against euro; May tries to gain support from Europe who say they want to help but will not renegotiate. Significant number of conservative members trigger a vote of confidence on May’s leadership.

Yesterday’s USDA report saw corn and soya up but wheat down. Report was not dramatic but cut US ethanol / corn demand, increased Ukraine corn crop and Brazil soya production. World wheat stocks were increased and cut US exports. Soya reacted to rumours of impending big soya purchase by China; reports suggest China to cut tariff on US made cars to 15% (same as non US producers), this could indicate better relations.

Concerns about possible US recession as Trump threatens to ‘shut down the government’.

October’s UK wheat exports estimated at 30,000 tonnes, imports possibly 300,000 tonnes.

Russian wheat exports slow down due to weather and higher domestic prices hampering exports.

French wheat area up as rapeseed area falls to 14 year low.

author: Joe Beardshaw

November 19th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down £1.15 on Friday but was up for the week, old crop up £2 and new crop up £1.50.
The May 19 – November 19 (old crop 2018 against new crop 2019) current differential is £17.20.

Sterling remains fragile due to Brexit situation; Barnier pays homage to Theresa May, praising her ‘courage’, which may not help her cause.

US markets are slightly firmer as continued speculation of trade talks may resolve US - China situation. Soya sales have struggled, current low prices (near 2 year low) have seen meal exports up 21% year on year.

French winter wheat crop ratings worst in nearly six years.

Russia has increased winter wheat plantings by an estimated 500,000 hectares this could mean an increase of 1.8 – 2.0 million tonnes if yields are average for harvest 2019.

Australian wheat production and possible cuts in Argentina production due to rain could reduce wheat availability.

Oil prices up last couple of days

author: Joe Beardshaw

October 22nd

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed higher on Friday but was down for the week (c. £1.50), 19 crop wheat futures were down £2.45 on the week. The differential between May 19 and November 19 is currently £17.80, this is a bigger spread than the norm.
UK trade still stagnant, few sellers or buyers appearing; currency stable but reacting to Brexit news. Eurozone has concerns about Italian economy and could be ‘downgraded ‘ by Moody’s.

Low water levels in Europe have seen more interest in possible UK feed barley exports. Quality issues in Europe have seen malting barley exports going at a good pace and with additional new business on the books, however this continuation will be subject to sufficient supplies.

US markets were down in corn and soya and slightly up on wheat. Soya markets fell as export sales for 300,000 tonnes were cancelled; 180,000t known to be direct to China, and the other 120,000t also suspected to the same destination.

$ remains firm, exerting downward pressure on prices and further US export trade.

France, as of October 14, had 32% wheat planted (39% last year), winter barley 44% (54%), corn 81% harvested (47% last year).

Oil price down as US stocks higher than anticipated, cancelling Saudi tension.

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

author: Joe Beardshaw

October 04th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up £1.85 yesterday, sterling gained against euro despite all the political uncertainty over Brexit

US markets had a quiet day but were slightly weaker after two days of solid gains. Prices are at low levels (soya 9 year low) with large harvest looming, although rain is causing delays. Stock market highs, high oil prices, good economic data (unemployment report due Friday) increase expectation of interest rate rise which is bearish commodities as it slows exports.

Russia and Saudi have increased oil production by 1 million barrels a day but prices have not fallen by much.

Continued speculation about Russian exports. Quality controls could slow export and has made shippers nervous of over committing sales; Russian domestic prices have risen in the last few weeks

author: Joe Beardshaw

September 13th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down £1.35 as yesterday’s after USDA report was perceived bearish.

US markets, especially corn and wheat, fell post USDA report. US corn yields increased (expected to be cut) and world wheat production was increased when most analysts had forecast a reduction (261 mmt from 258 mmt); Russian crops were increased. Soya also had a bearish report but values held up as funds bought on the rumour of new Chinese trade talks.
Scepticism of USDA reports increase; suggestions of political motive, but reports still have impact on markets and sentiment.

Canadian crops having suffered drought and now face very wet weather and even snow; 25% wheat harvested and19% canola), this may not affect yield but quality e.g malting barley.

US approaching Hurricane Florence has been downgraded but damage is still expected.

French barley stocks at 11 year low.

Oil reached year high, Brent +$80 at one stage but currently c. $79, low US stocks and reduced Iranian supplies the reason.

Gove announces new farm bill for next 7 years, promising high environmental standards.

author: Joe Beardshaw

August 29th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down £2.45 yesterday as London followed Matif’s losses on Monday.

Sterling lower as chance of ‘No deal’ Brexit increases.

UK and French wheat and barley are at similar levels on export markets, but both undercut by Baltic origin into Denmark and Sweden. There is market uncertainty regarding exports after March 2019, what if ‘No deal’ Brexit becomes reality and export tariffs are implemented?

US markets down, led by soya, markets stay under pressure with big crops looming and tariff restrictions.

First time in a year, US wheat featured in Egypt tender. Egypt bought Black Sea wheat, US offer $30 above cheapest offer; US supplies are expensive in nearby position, however they get more competitive in forward positions.
With reduced Russian wheat supplies, exports will get tight from Russia and export restrictions maybe announced; US trade did take note of US wheat featuring.

USDA has Russian wheat production at 68 mmt, Russian estimates were higher; yields in Volga valley region lower than expected due to dry weather which may cause Russia to reduce estimates.

Oil maintains levels supported by weaker $, reduced US stocks and hope of US / Mexico trade deal may increase demand.

author: Joe Beardshaw

August 13th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down 15p on Friday, but gained £2.90 over the week. November 19 wheat lost 40p over the week and the differential between November 18 and November 19 is currently £22.15

USDA report had a bearish impact on US markets, record corn and soya yields predicted but not in the barn yet and trade will be influenced by ‘unpredictable’ tariff situation.

US markets appear insulated from world situation, comforted by their own crops that have benefited from good weather; many traders are sceptical of USDA statistics as Australian and Canadian wheat forecast unchanged, even when reports suggest weather issues etc.

Fundamentals remain bullish, problems in Europe, Russia and Australia; Ukraine allegedly going to restrict wheat exports to 16 mmt this season.

USDA did cut EU wheat crop to 137.5 from 145 (july estimate)

French corn put at 62% good to excellent, lowest since 2015; wet weather delayed planting and heat not helpful.

China says they will have better domestic corn crop, they expect to reduce imports and will target South American soya; Argentina and Brazil hopeful for good crop size.

Euro falls as Trump targets Turkey, Turkish lira at record lows; markets nervous of EU bank’s exposure to Turkey.

European markets have seen big price gains; a bull market needs to be fed and how much more bullish news can appear, that is not already factored in?

author: Joe Beardshaw

August 06th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down 95p on Friday but still showed £8.05 gain for the week. Differential between November 18 and November 19 currently £18.85.

Despite interest rate rise sterling remained week due to Brexit situation.

EU wheat had the highest weekly close for 4 years as markets responded to rumours of possible Ukraine wheat export ban; Ukraine ministry denied information and raised their wheat estimate to 24 mmt from previous 22-23 mmt with the message ‘keep calm’!

Latest UK wheat estimate is 13.5 mmt, potentially lowest crop for 5 years (last year 14.8); yield average coming in at 7.6 – 7.8 t/h against 5 year average 8.2 t/h.
Demand for animal feed is at high levels, hot weather has suppressed grass growth adding to the impact from the Beast from East.

Bullish sentiment continues, hot dry weather has reduced French maize crop ratings, even though damage is limited it has fuelled sentiment.

US markets are quiet, attention is focused on Fridays USDA report, cuts to wheat and corn crops are anticipated but US insulated from global conditions as their crop ratings are reasonable.

author: Joe Beardshaw

July 26th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat continued to rise, Nov 18 closing £5 higher. French wheat also higher, Strategie Grains cut EU wheat production for second time in 2 weeks.

Early reports suggest UK wheat yield is better than anticipated but the poor yields are not reported and futures continue to rise. The sentiment is that domestic consumers are covered in nearby positions but still have to cover forward. There is little or no demand to ports due to no exports, ‘spot’ wheat struggling to find homes.

Ensus has bought as far as December and using imported wheat and corn, Vivergo plan not certain. Imported tonnage may reduce the premium to the north and not drag wheat from the south.

US markets, especially wheat, gained as US trade wakes up to problems in EU, combined with concerns in Australia, Canada, Russia.
Corn supported by wheat, especially with low world stocks and increased demand. Spring wheat yield surveys indicate yield forecast below USDA predictions.

Egypt buys 420,000 tonnes wheat at highest price since 2015.

Feed barley prices firm as demand increases and UK barley competes in export markets; differential to wheat narrows.

author: Joe Beardshaw

May 21st

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London November 18 wheat closed up £1.25 on Friday, the market closed up 55p on the week. London markets followed global wheat market trends, wheat gaining value in US and Europe.

There is a bullish sentiment to wheat, all the major global wheat exporters having weather / production concerns : US, Europe, Black Sea, Australia and South America. Corn stocks are also forecast to reduce due to the issues with planting.

Last season the Russian Rostov region accounted for 13% of Russian wheat production (10.8 mmt) but this region currently has the lowest levels of soil moisture since 2013; only received 50% of expected rainfall in the last 30 days and temperatures between 2 – 4 degrees above average growing conditions. However, rain is forecast and crops still look well, but not as good as last year.

US markets were up due to combination of weather and politics. Corn, soya and sorghum all supported by reports that China and US had reached a trade agreement and reduced tariff threat. Wheat was up; Kansas wheat up nearly 20 cents as state of winter wheat crop has provoked buying demand.

author: Joe Beardshaw

May 11th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London November 18 wheat closed up 50p, whilst Matif wheat was lower, this was largely due to currency; sterling fell as Bank of England announced no interest rate rise (vote 7 – 2), which was anticipated. Slower economic growth had BOE saying ‘only limited tightening needed’, next rate hike forecast February 2019.

US markets digested USDA report and initial reaction was soya gaining sharply before falling back, the report did not have many surprises regarding production but the bulls seized on reduced stocks 2018-19

Excluding external factors such as economics and currency etc, the attention focussed on weather and where there are areas of uncertainty:
Argentina drought well documented with economic problems
Brazil becoming increasingly dry
Australia dry with may forecast not predicting rain
Europe especially eastern Europe turning drier
US mixed with dry and excessive moisture in various area…

But USDA suggests that globally a big wheat harvest is still anticipated for 2018-19!

author: Joe Beardshaw
April 24th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London November wheat closed unchanged yesterday having gained 25p on Friday, up 30p last week.

New crop values have shown resilience, currently world fundamentals / supply are not having any major production threats. Old crop futures is technical, physical and futures becoming disconnected; domestic prices supported by continued demand to the north, although there are increasing volumes of imported wheat coming into Hull. Milling premiums have increased as supplies of quality wheat have tightened

Sterling stable, despite expectation of 2 interest rate rises this year, first anticipated in May.

US markets have fallen, better weather helping corn and spring wheat planting, calming the previous bullish sentiment; $ stronger not helping commodities.

UK spring barley planting progressing, although heavy land still struggling but this is not traditional malting barley land. Scotland has made good progress, but planting has been delayed and likely to impact yield and quality, much will now depend on seasonal weather.

Spring planting from France to Black sea has been slow affecting barley and sugar beet and some area may not get planted and yield certainly reduced.

Feed barley remains buoyant, rumours suggest Saudi maybe in to buy this week. There has been good demand for German new crop feed barley; Ukraine production estimated down 8.5%, spring area replaced by sunflowers due to weather. Australian and Canadian barley production is down, making for tighter balance sheet, especially if China wants increased tonnages to replace US sorghum if tariffs are imposed.

author: Joe Beardshaw

April 16th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up c. £1.40 for the week, ex farm prices reaching highest levels since before harvest.
Demand to the north and feed industry; wheat usage in feed industry july – feb is up 2.7% above last year’s record pace; barley + 25%!
Stronger sterling increases import possibilities and with smaller crop (14 m.t?) import values will have greater influence than export values.

Matif wheat hit a high last Monday before falling, which is impressive considering the slow pace of exports.

US markets fell on Friday due to a combination of profit taking and analytical reasons. Brazilian soya at its highest level since August 2016 as Chinese demand intensifies (US trade threats) and drought in Argentina; Brazil forecast record harvest. Corn and Kansas wheat both bounced back from resistance levels of 1 year high.

Wheat in Europe, Russia and Ukraine is generally not threatened by significant weather, although wet conditions in Europe have prevented some inputs being applied.

Rouble weakness provoked by current conflict has made Russian wheat even cheaper in world markets, but Russian growers maybe reluctant sellers not wanting to be paid in currency losing value.

author: Joe Beardshaw

April 09th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down 20p on new crop but had gains for the week + £2.10, old crop and + £1.85 new crop. Physical demand to the north has seen premiums over the futures; reports of wheat being shipped from the south coast to Hull. Maize can replace wheat for some ethanol production but tight domestic wheat supplies are supporting values.

US markets have performed better than expected, even with the threat of tariffs overhanging the market. Tariffs have not been imposed yet as sabre rattling takes place between US and China. The US export programme starts in earnest in September, there are hopes that a resolution will be reached by then.

China has a swelling livestock / meat demand and this needs soya meal; soya has c. 4 times protein content of alternatives and Brazil can only supply so much, as a side note, Brazil are having beneficial rain. US growers could switch from planting soya to corn; corn planting until end of May, soya end of June.

US Wheat was up Friday as problems persist, winter wheat in the great plains is now suffering from freezing conditions combined with drought; spring wheat in northern plains and Canadian prairies experiencing cold conditions which is slowing planting.

French wheat rated 78% good / very good compared to 90% this time last year; winter barley 74%, last year 85%. Spring barley nearly complete but much later than normal.

Southern Russia , Ukraine and Romania experiencing temperatures 3 – 6 degrees above average but moisture reserves are good and conditions helping spring planting.

Feed barley demand from UK remains high but trade is constricted by a lack of old crop supplies. New crop could come under pressure as traditional home (Spain) has good crop prospects following rain and South American corn could be cheap alternative but European balance sheet could be tight if China remains as a buyer.

Oil values are down, oil markets have worst week for 2 months, US stocks and production increase combined with trade tensions.

author: Joe Beardshaw

April 05th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed almost unchanged having recovered from early losses. UK wheat demand to the north remains frustrated by a lack of supplies coming forward and increasing the prospect of more imports, if European supplies become offered / available.

US markets reacted sharply and lower on the news of proposed Chinese import tariffs on soybeans amongst other products and market panic spread to stocks , energy and livestock markets. Markets then recovered as the falls were seen as a buying opportunity; tariffs are not yet imposed and Chinese action was seen as retaliatory if US imposes sanctions. Sanctions do not increase availability of global soya supply and if China switches to Brazilian supplies you could see US beans exported to Brazil - done before!

Market stability indicated Dow opened 1.75% down closed up 1%.

Fundamentals in US remain bullish on weather markets, freezing temperatures in southern plains and drought is still a concern in certain areas.

Lingering winter in Russia is slowing spring planting, progress is 2 weeks behind and well behind comparable time last year, only c. 1% planted of intended spring crops. Shorter growing season will impact on yield and spring crops are significant to overall Russian production.

French market supply suffering from rail strikes and high water levels.

author: Joe Beardshaw

March 26th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down on Friday, bringing total weekly losses - £2.60 May 18 and - £2.10 November 18. Sterling remains stable against euro as perceived progress in Brexit negotiations

US had a choppy trading day on Friday. Chinese tariffs on imported US pork had collateral impact on other commodities; Chinese pork production increased with domestic prices down so situation suits pork tariff. Soya meal closed up due to Argentinean situation, soya production put at 39.5 mmt, 31% down on Jan estimate; crops 18% maturity and 80% rated poor to very poor. Despite rain in Kansas, winter wheat was up; crop ratings due today.

Feed barley now trading above feed wheat in export markets, new crop demand looks underpinned - China etc. Spain, a traditional feed barley importer has had some rain that will help domestic crops; UK spring barley now getting drilled and some will be feed. Wheat prices down; old crop demand down, ruminant feed season declines. Winter crops have not come out of UK winter in good condition.

International Grain Council has rapeseed / canola crops at highest potential production for a decade. 2018-19 has an estimated increase of 900,000 tonnes at 75.6 mmt although consumption estimated 75.8 mmt up 1.7 mmt. Difficult to be accurate on figures as increased production dependant on increased area in Canada and stocks influenced by Chinese tonnage held. EU rapeseed up 2.1% to 22.3 mmt.

Oil up 2% with Brent crude + $70 barrel.
Trump has appointed his new National security advisor, middle east hawk, John Bolton.

author: Joe Beardshaw

March 21st

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Yesterday’s trade was quiet, May 18 London wheat closed unchanged and November 18 up 25p. Lack of sellers continues to frustrate buyers; on paper there should significant volumes to trade but markets do not feel like it.

Sterling has held most of the recent gains against the euro (+ 1.14) despite latest inflation figures falling to 2.7% from previous 3%, this has largely been attributed to lower petrol prices. Falling inflation has reduced pressure to increase interest rates; an interest rate rise had been predicted for May and would also be supportive to sterling. Some economists foresee an increase in wages exceeding the rate of inflation, this may also further reduce pressure.

US markets also quiet, but soya and meal had modest gains. Winter wheat still suffering from drought, crop ratings are down again, apart from Louisiana and Mississippi. European, Russian and Ukrainian wheat crops will have more market impact than the relatively insignificant US winter wheat (less than 5% world wheat crop)

Weather forecast predicting another possible cold blast in UK for Easter; snow a possibility, especially in the north.

Oil up 2% (Brent $67.50) reaching 3 week high as world glut is reduced and US sanctions against Iran (oil exporter). Supply / demand could reach equilibrium by September, sooner than expected; OPEC supply restrictions appear to work but higher prices could see increased US shale output.

author: Joe Beardshaw

March 13th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down yesterday 50p in new and old crop positions.

US grain rebounded, wheat and soya up slightly after Fridays losses. Corn supported by good export figures and funds / speculators have biggest net long in corn since June 2016, potentially a dangerous position this early in the season if sentiment changes.

Sterling up helping the prospect of wheat imports into UK especially coupled with tight domestic supplies and lower matif.

French wheat exports increasing as Black Sea prices rally; Algeria looking to buy which could be French origin.

Wet weather in UK prevents spring barley drilling and getting more serious than just concerning, new crop FOB prices are up.

Argentina gets some rain but regional and possibly too late.
US plains remain dry and forecast offers little relief.
Snow in Russia protecting crops.

Ukraine grain exports hampered by aged rail network; 2/3’s grain hauled by rail with locomotives and trucks used are from 1980’s

Oil down after biggest rally for 7 months, new output supply from US will satisfy demand.

author: Joe Beardshaw

March 09th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed fractionally higher, but with USDA report published at 5pm UK time, market reaction was limited.

USDA report was mixed, bullish corn and bearish soya and wheat. Post report, corn rallied to 6 month high, South American production and US demand has increased. US exports, which had been very slow, will improve as exports increase to fill Argentinean deficits, although Brazil is on course for a big crop. Global wheat production was increased and consumption reduced.

UK wheat area predicted down 2% for harvest 2018 and if yield is at or below 5 year average it could be smallest crop since 213-14.

Global wheat production 2017-18 record 758.2 mmt but demand is increasing and stocks to use ratio of 36% is reduced from 10 years ago; stocks to use ratio difficult to assess as China holds significant amounts. World wheat area not changing so production very dependent on yield, increasing impact of weather threats.

US winter wheat poor condition, Kansas 50% + rated poor / very poor and 76% area topsoil moisture is short / very short

Asian markets rallies on news Trump to meet Kim Jong-un.

US imposes steel and aluminium import tariffs escalating trade dispute

author: Joe Beardshaw

March 05th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat lost momentum on Friday, closing down 85p May 18 and down £1.55 November 18; at one point November 18 was trading £2.05 above the close. However, the week’s gains were up £2.50 old crop and £1.05 new crop; the May - November spread has reduced to c. £3.80 reducing incentive to hold grain.

US markets also closed weaker on Friday but showed weekly gains. Continued drought in Argentina and dry weather in plains underpins soya and wheat markets respectively, long range forecast not showing any major changes.

Washington announcement on steel and aluminium tariffs (25% /15%) has raised fears of retaliatory action on US agricultural exports and could see for instance, China switching to Brazilian origin soya.

China forecasts growth for 2018 at 6.5% from 6.9% in 2017.

Sterling found little support in May’s speech ref Brexit, although euro may be influenced by the outcome of the Italian election.

UK wheat remains a domestic dominated affair, whilst barley has good demand to ports.

author: Joe Beardshaw

February 28th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed slightly up yesterday and continue to increase this morning.

US markets were higher despite stronger $. Weather continues to support soya; some forecasts have Argentinean soya as low as 40 mmt (USDA 54 mmt). US meal highest for 18 months but US soya exports still lagging (-13%) surprising in this situation? High prices could reduce demand.

US Wheat up, especially winter wheat due dry conditions and crop ratings are also significantly down, this is attracting commercial buying. Kansas wheat (hard red winter +2.3%) at a 6 month high and Chicago wheat, soft red winter + 1%.

Despite stronger US wheat markets and current European weather, French wheat markets have remained largely static.
Reports continue about areas lacking snow cover and suffering damage.

$ gained as fed chairman Powell was positive about US economic growth. Euro down 0.6% against $ but rouble down 1.2% supporting Russian wheat in export markets.

Oil down, US shale production increased coupled with higher US stocks.

author: Joe Beardshaw

February 20th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up 80p yesterday. Despite many markets closed yesterday e.g. US, China, trade responded to some bullish weather.

Dry weather in Argentina continues to threaten, soya crop reduced from 60 mm tonnes at beginning of season to current estimates of 50 mmt; limited rains are forecast. Very firm soya meal prices increase crush margins.

US South west plains continue to be dry lending market support.

Russian wheat prices were up $2 yesterday, demand from Iran etc underpins values, coupled with weather markets. French wheat crop rating decline. Russia are forecasting to harvest 80-83 mmt wheat.

Rapeseed broke technical barriers yesterday for first time in 3 months, as a result of Argentine soya conditions.

Sterling being tugged by conflicting influences, 78% of poll expecting interest rate rise in May, this supports sterling against continued Brexit concerns. UK waiting employment numbers on Wednesday and domestic production on Thursday.

J.P. Morgan predict further gains in agricultural markets in 2018 as weather injects risk premium; agricultural commodities best performer so far 2018 up c. 5%.

European crops not winter hardened due to mild conditions and very cold weather forecast next week but snow cover will offer protection.

author: Joe Beardshaw

February 16th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up 20p but on thin volume.

US markets, especially soya and wheat, were higher as a combination of weather and weaker $ giving market direction. Ag coms are perceived weak compared to share market; gold reached values equivalent of 2017 highs ($1357).

Soya meal stronger, breaking price resistance levels, whilst soya oil weaker. Argentina, the biggest meal exporter, continues to suffer from dry weather; soya yields estimated down 40% year on year and 80% crops suffering stress.
Argentina is also the third largest corn exporter.

2018 UK wheat looks tight with an estimated 14.2 mmt crop; tight supplies from current crop in the north is continuing to pull more tonnages from the south of the country.

Export demand is strong for old crop barley, presently trading at near parity to wheat, and especially with imminent Saudi tender.

French wheat is trading at lower premiums compared to traditional UK levels, taking into account quality differences etc.
French wheat stocks likely to swell due to slow exports; EU exports down 19% year on year due to strong euro and black sea competition. Barley exports are up 17%; corn exports down 61%, corn imports + 52%

Malting prices have eased but concerns remain as weather delays planting in Europe and UK, this is supporting winter malting prices but, domestic winter barley demand c. 300,000t against total trade of 1.9 million tonnes.

Global barley production estimates for 2018 are down 4 mmt compared 2017, underpinning barley markets.

Major players e.g Cargill and Bunge investing heavily in Ukraine infrastructure which could see their exports up 50% in 3 years; presently Ukraine is 4th largest exporter.

author: Joe Beardshaw

January 18th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed higher (old crop + 15p and new + 75p); although sterling is stronger against the euro and $.

Matif wheat also up after recent falls as EU wheat suffers from stronger euro and competition from Russian grain in export markets.

US markets also up with corn rally having biggest gain since november 17; after bearish USDA report of increased yields market supported by commercial buying
Soya up with crush margins of c. 17% increasing demand; meal from the crush helped by higher livestock numbers / demand and meal exports up 8%.

Rain in Brazil may hamper soya harvest.

Wheat also gained.

Despite better soya values and high mineral oil prices osr suffering from palm oil price falls not helped by EU parliament statement that they want to phase out vegoil in biodiesel by 2021 mainly due to environmental concerns; also stronger sterling having negative effect.

UK barley well priced for export markets (wheat barley differential now c. £3 in export / FOB levels although domestic buyers want bigger discount); but may miss big boat trade likely to be supplied France and black sea origin. Danish cheapest source wheat coasters whilst France supplies big wheat boats.

Lack sellers keeps UK wheat shorts nervous.

Snow forecast for Russia to protect against winter kill but temperatures remain above normal / average seasonal levels.

Baltic countries account for less than 5% EU wheat production but exports increasing (Latvia x5, Lithuania x 2) as they benefit from higher protein / better quality putting them third exporter behind France and Romania.

Goldman Sachs has first quarter loss (£1.4 billion) in six years.

author: Joe Beardshaw

January 15th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down £1 on old crop and down 40p new crop, bringing the weekly summary old – 50p and new -30p, November 18 currently is a £2.70 premium over May 18

USDA did surprise some analysts; corn down, wheat sharply down and soya up. Corn yield increased to 176.6 b/acre (record yield) increasing supplies. This yield increase was a surprise considering dry growing condition in mid-west. Exports and demand are down swelling supplies. Wheat area lowest area since 1909, latest estimate down 1% compared to previous, however many analysts were expecting 4% area reduction. Soya markets saw prices up, short covering occurred as report reduced soya yield from 49.5 b/acre to 49.1 b/acre. Brazil soya + 2 mmt and Argentina – 1 mmt from previous.

China increasing imports of Brazilian soya at the expense of US, protein levels higher but also retribution for hostile trade talks from US to China

UK domestic wheat values are stable, the slow pace of tonnage coming forward is absorbed by consumers / trade shorts.
UK is not competitive in wheat export markets and imports are not viable to interior homes.

Sterling reached highest level against $ since Brexit vote; £ / euro not moving, sterling supported by unconfirmed reports. Spain and Netherlands want to maintain trade links with UK. Sterling could take a knock with news that the construction company Carillion is set to go into liquidation.

author: Joe Beardshaw

December 18th


Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat was slightly up Friday but an indication of the lack lustre nature of wheat markets, old crop down 10p and new crop up 15p for the week.

US markets also had a negative week, especially corn and soya. Corn and soya have had a difficult trading year and ‘normally’ the commodities that lose have a reversal the following year, but this could be ‘bull desperation’.

The USDA put 2017 global wheat crop at 755 mmt and world stocks set to increase to 268 mmt, the sentiment remains strongly bearish but these numbers are factored in and it remains dry in the US wheat areas and the effect of La Nina is uncertain.

South America is a mixture of weather; Argentina needing to plant c. 6 million hectares soya in next two weeks but areas suffering from dryness or excessive rainfall again attributed to La Nina. Argentina is the third largest grower of soya and number one meal exporter.

UK barley has remained resilient, despite sterling gaining and more expensive freight, French supplies are cheaper; differential to wheat at season lows. New crop values fell c.£4 last week, sellers got desperate but it remains dry in Spain and could offer export opportunities, subject currency and Brexit negotiations.

author: Joe Beardshaw

December 15th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat market is static, gained 5p on Wednesday and then lost 5p yesterday; only 33 lots traded yesterday, indicating market apathy. Wheat market are still confused, exports are not happening, surplus not coming forward and frustrating domestic demand; there are supplies in the south but appear tight in the north.

UK old crop feed barley is still in demand but new crop ‘fob’ prices are down c. £4 as sellers lowered expectations.

Sterling gained strength; May ‘applauded’ by EU, which probably incites the Brexit hardliners. The recent lost vote in UK means negotiations are far from straight forward.

2017 Eurozone growth raised to 2.4% from ECB 2.2% forecast, some analysts forecasting euro to gain 10% against $ in next 12 months; currency who knows?

US markets mixed but last week soya challenged 4 month high, now though it continues to slide as favourable south American weather sees funds trying to reduce long positions. Wheat has gained due to dry conditions in some areas, improved export numbers, commercial buying and funds trying to cover short positions.

Fed under Yellen’s final announcement raised interest rates 0.25% - as expected

Signs of La Nina continue to strengthen, pacific ocean temperatures are decreasing. This effect is likely cause cold north US, dry south America and wet Australia. Possibly major effect could be increased energy demand in north America pushing up oil, gas etc

Argentinean wheat armada loading 220,000 destines for Algeria and other north African destinations, which are traditional French export destinations. However, progress is delayed by port strike in Argentina.

author: Joe Beardshaw

December 07th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat was, on average, down 60p yesterday but with little activity. Sterling undecided as Brexit negotiations stumble along.

US markets down, especially wheat (5 month low), a reaction to Canada raising wheat crop from 27.1 mmt to 30 mmt, this was unexpected after summer drought. The reaction backed up by non-commercials / funds going long, which could see selling stampede.
Soya, after recent rises, saw 2017 market highs reached, but hesitant as South American weather is being watched; La Nina blamed for dry south America and wet Australia.

Russia gains markets into S.E. Asia and Middle East; traditionally supplied by Australia. Russian wheat up to $100 cheaper than Australian in certain grades.

Oil falls 2.7% as good gasoline supplies in US may mean less demand for crude / refining.

author: Joe Beardshaw

November 23rd

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat was up yesterday (May 18 +80p; Nov 18 + £1.30) after a mixed day Tuesday (May 18 + 15p; Nov 18 – 60p)

Sterling has not had significant reaction to budget, despite reduced economic growth forecast. Euro still nervous with political manoeuvring in Germany and will Merkel continue?

US markets closed Thursday for thanks giving. Wheat has been ‘creeping’ higher as current low prices should limit the down side. Winter wheat ratings have been downgraded. Corn market is complicated, funds are short and commercials are long, creating a standoff, but if any bullish factors emerge, there could be panic short covering. Soya has been supported recently by better meal and vegetable oil markets.

US markets have been helped by $ decline in November, which is bullish to commodities. The economic index, which is mainly based on oil and gold prices, is at a 1 year high, which would again be seen as bullish influence on commodities.

Russia has been dominating the world wheat export market but there are reports of radiation problems that occurred in September, possibly impacting on wheat supplies. This radiation leak appears to come from the south Urals and Greenpeace want to probe radiation emissions. The almost total lack of reporting would indicate a very insignificant event, but the market bulls are trying to use it as a bullish factor, suggesting wheat grain and plants could be contaminated (wheat prices rose 16% post Chernobyl)

Parts of Europe are still showing a moisture deficit.

Brent crude currently $63+ barrel

author: Joe Beardshaw

November 20th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up 80p on Friday, but down c. £1 for the week.

EU wheat price was 3 euros down on the week.

UK wheat balance sheet looks tight, despite lack of exports as domestic demand is up but closure of Vivergo for maintenance eases some of the pressure. Reduction in bioethanol prices brought forward maintenance closure; Vivergo would use c. 800,000 tonnes year.

US markets all had an up day Friday, especially soya, which saw meal prices rise following increase in soya oil due to increased commercial buying.

Commodities in general closed higher, gold up $15 and oil gained 2% as Russia may support / extend production restraint in line with OPEC; weaker $ also helped.

Wheat market still dominated by Black sea / Argentinean supplies.

UK budget due Wednesday which may impact sterling.

Parts of EU (France, parts Germany, Spain and Northern Italy) are all suffering from lack of moisture but Russia is forecast for snow to give protection from winter kill.

author: Joe Beardshaw

November 10th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up 5p but on very thin volume; sterling slightly weaker.

Danish wheat prices rose helping possible / unlikely UK wheat exports, subject currency.
Barley is having greater activity, trading at a premium to wheat in Spain, this could provoke big boat exports.

USDA report was expected to have little market impact, but saw big falls in corn and a rise in wheat. Corn stocks estimated higher than highest analyst estimate, resulting in corn setting new lows and breaking previous support levels; will this see commercial buying? But funds increased shorts. Corn numbers were surprising, yields were estimated high when the crops in the field had worst rating since 2013. Wheat gained, stocks lower than pre report estimates but there is still a lot of wheat about, will the rise be sustained?

Brazil further reduces wheat crop to 4.57 mmt, 32% below last year

Oil stable with Brent c.$64 barrel

author: Joe Beardshaw

November 01st

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down £1.50 yesterday, sterling stronger at 1.14 currently against the euro.

U.S markets are weaker, wheat reaching new low, despite 100,000 tonnes of hard winter wheat being sold to Iraq; wheat down trend has been in place since July. Corn harvest is backward; 54% cut (last year 73%), but benign weather conditions do not pose a threat at this stage. Trump due to appoint new Fed chair on Thursday, Jerome Powell is the favourite.

Russia announced it will cut internal rail rates to boost wheat supplies. In 2010, Black sea wheat was 10% of global market, now it accounts for 16%, indicating the areas growth.

World wheat stocks are heavy, but there are concerns about 2018 crop. Going into Northern hemisphere winter, crops in Russia, Ukraine and parts of Europe not looking as robust as expected, whether this proves a problem we do not know, but with Southern hemisphere crops down, this could have increased impact.

Oil continues to gain, Brent crude currently $61+ barrel; OPEC and Russia contemplate extending cuts, world stocks are diminishing.

author: Joe Beardshaw

October 23rd

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat was slightly weaker Friday, but November 18 values closed above May 18 provoking some selling of crop 18.

Sterling supported by Merkel and Tusk saying ‘negotiation deadlock exaggerated’ as they try to bolster Mays position; both parties need each other and an agreement is necessary but politicians want to gain public opinion credibility.

Catalonia continues to rock the European boat

UK reports smallest trade deficit for 10 years down 11% from 1 year ago

US markets slump as heavy corn yields are reported and prices close to August lows; one area that rose was soya oil, changes to biodiesel mandate. $ up, possible tax reforms anticipated; stronger $ traditionally bearish ag coms.

Spread between Uk and French wheat prices close, if DEFRA’S crop figure of 15.2 mmt is correct, exports will be required.

Black sea wheat continues to dominate markets, world stocks put at record 268 mmt.

Australian wheat production now 20 mmt, but exports forecast are unchanged at 18 mmt; heavy stocks remain after last year’s 35 mmt crop.

Argentina respond to Macin cutting export taxes, corn area up nearly twice the area planted 2010-11.

author: Joe Beardshaw

October 20th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up 95p for May 18 and November 18.

Sterling down, euro again worth 90p+. Brexit negotiations continue with little reported progress. Merkel / Christian democrats entering her 4th term but after reduced vote may not find coalition partners until 2018; coming under pressure from anti-immigration ‘Alternative’ party and recent Austrian election results.

US markets bounced on Thursday after flat bearish Wednesday but pricing bouncing along lows. Trump sounding on biofuel supported soya oil. US retail sales figures fell 0.8% September, third quarter growth lowest since 2013; markets perceive this as reducing interest rate rise possibilities.

UK attention is on 2018 prices and corn is premium to production costs but will it attract farmer selling?

Russia raised wheat export forecast for 2017 crop by 1.5 mmt to 33.9 mmt, this is supporting sentiment of plentiful global supplies; Egypt poised to buy another Russian 230,000 tonnes, in contrast Australian production is reduced.

author: Joe Beardshaw

October 06th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat has been ‘choppy’ this week but currently November 17 is + £1 and November 18 + £0.60. Apart from fundamentals the grain markets are continuing to be difficult to predict due to all of the external influences (politics / Brexit, currency etc).

Defra has surprised the trade with UK wheat crop prediction at 15.16 for 2017 crop, 5.4% increase on 2016 crop, many expected c. 14.5 mmt with coceral estimating 14.75 and IGC estimating 13.9 mmt. Usual indicators of a lack of farmer selling / grain coming forward does not indicate harvest this big, prices did retreat as result but were supported by weaker sterling as political turmoil continues.

US markets started the week weaker, but both wheat and soya has had up days, corn has been quiet. Variable rain has been hampering some harvesting, whilst also impacting planting. US jobs / unemployment data is due to be published which may decide whether FED raises interest rates in Dec, rates up = $ up = bearish ag coms! Wall street at record highs as technical and financial companies benefitted from tax cuts.

Egypt buys 180,000 tonnes Russian wheat at latest tender but only up $2.20 from previous purchase 2 weeks ago, however world wheat has gone up 5% but cheaper freight has helped.

UK feed barley market is firmer, we are competitive, especially with weaker sterling enabling a series of larger vessels to be sold for November 17.

UN has reduced world wheat stocks down 700,000 tonnes, consumption estimated up 3.4 mmt, but still a record at 261.2 mmt; stocks to use ratio of 34.6 is up 1.1% year on year and 30 year high level. However it is early days; reports of a lack of rain in Russia is slowing crop establishment and potentially weaker plants going into winter. Has Russia drilled a big wheat area?

EU wheat area for 2018 similar to 2017, but oilseed area was expected up due to high prices but dry conditions have curtailed the increase.

author: Joe Beardshaw

September 22nd

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down 5p on a quiet trading day. Sterling unchanged, markets wait for May’s major speech outlining Brexit strategy.

Speculation about the size of the UK wheat crop range from 14.2 – 14.7 mmt, lack of farmer selling is supporting the market; September always difficult month as growers concentrate on land work

US markets slightly higher as current low prices find buying support; have the seasonal lows been seen? Since bearish USDA report of 12 September, prices have not declined as previously expected.

Russian 2017 wheat crop up 11% year on year but dry conditions and rain deficit hampering autumn planting and next years crop.

China sees it’s credit rating cut due to debt and credit growth posing economic and financial risk.

EU malting barley markets rise as Copenhagen conference fuels sentiment of tight supplies and variable quality.

author: Joe Beardshaw

September 18th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down 85p on Friday, bringing the weeks fall to £1.90; the fall has largely been attributed to sterling gains, currently £ / euro 1.1382.

Previous Euro strength has been hindering EU exports, exports from EU 45% below last season. Big Russian crop dominated markets, Russian grain is being exported to Indonesia, Vietnam and they almost have a monopoly on Egyptian business. Egypt states they have 3.4 million tonnes wheat stocks enough for 4.5 months’ supply.

Australian wheat crop expected to be cut further due to weather issues.

US markets are quiet but soya remains supported by Chinese demand and wet conditions in Argentina, dry conditions Brazil.

Mixed quality for US wheat; 2017 average protein 13.2, previous record came in 2003 at 12.7, 11.8 is the 5 year average and last year it was 12.4. Average kg/hl is 76.8 and hagberg 259 (5 year average 301). It is estimated that only 31% group 1 wheat suitable for breadmaking but 40% of wheat crop was group 1 & 2. Whilst premiums have improved, will there could be a swing this autumn away from growing quality wheats with additional costs?

Oil continues to firm whilst gold declines.

author: Joe Beardshaw

September 13th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down 10p but last night’s USDA report published near to the London market close, so there may be some reaction first thing.

The USDA report summary:
Corn – bearish, yields put at 169.9 bushels / acre, if true would see stocks to use ratio at 12 year high. Corn markets initially fell post report but did recover, values closed at market lows and ‘perceived’ cheap.
Soya – bearish, yield / crop maintained previous big crop forecast.
Wheat – neutral, but traded up as report indicated world stocks slightly reduced, although it estimated Russian wheat crop at 81 mmt.

Sterling maintains gains, euro worth roughly 90p (92p last week), UK budget announced for Wednesday 22 November.

Australian wheat production lowest for 9 years and canola lowest crop since 2010.

Brent crude close to $55 barrel

author: Joe Beardshaw

August 08th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Yesterday, London wheat closed down 75p despite sterling weakness, Brexit negotiations stumble on.

US markets were up, an important USDA report is due Thursday, this will focus on production and supply / demand. Corn production will be lower due to present weather pattern; soya yields will be reduced but record area was planted.

Australian wheat crop has been further cut to 22.7-22.8 mmt, last year producing 35.1 mmt.

French soft wheat production is up at 36.78 mmt (+34% year on year), average yields 7.15 t/h. Rapeseed production 5.22 mmt (last year 4.74 mmt) average yields 4.74 t/h. Corn estimated 12.76 mmt (2016 11.71 mmt).

Chinese corn deficit put at 9 mmt (previous 6 mmt) as demand out paces production, however this deficit does not include state reserves which gives some insurance; true situation in China never known exactly.

Malting barley prices remain stable, 55,000t French malting barley destined for China.

author: Joe Beardshaw

July 24th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up on Friday 25p but showing little change on the week, unlike European wheat with matif wheat closing €6 down on the week.

French quality / protein good, French production estimated 36.6 mmt (27.6mmt 2016 crop), roughly in line with production average 2008-15. Yield average forecast at 7.12 t/h, this is 3.6% below 2008-15 average.

Early UK wheat results ‘encouraging’. Nationally, winter malting barley quality is good - average nitrogen’s but variable screenings. Early spring barley results are mixed, some good results in East Anglia but early days. UK feed wheat is presently too expensive for exports and milling premiums may come under pressure if quality is good and high % of group 1 & 2’s planted.

US markets were mixed, corn sharply down despite hottest temperature of the year and momentum appears to be stalling. Soya showed some resilience and wheat continues to suffer from hot and dry conditions.

IMF reduced growth forecast for UK and US, UK growth reduced to 1.7% from previous 2.0% and US reduced to 2.1% from 2.3%. European growth increased and global growth 2017 estimated at 3.5% and 2018 3.6%
UK and US start trade deal talks.
US allowed to ship US rice to China for first time ever.

Oil prices down as production reduction has not drastically cut supplies, Nigeria and Libya increasing production.

author: Joe Beardshaw

July 20th

Market report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions

London wheat traded up 55p on Tuesday but lost this small gain yesterday, although on light volume.

US corn and soya firmer as weather continues to threaten yields but wheat slightly weaker.

Very early UK wheat results indicate good quality with ‘alleged’ very high kg/hl. UK wheat about £5 too expensive to compete in current export markets, but with tight balance sheet it will depend on production.

French wheat quality good with high protein, this may help their export programme.

UK barley does compete in export markets at current levels and already export volumes look very healthy. First spring barley results showing very variable quality in terms of screenings and nitrogen, but too early to draw firm conclusions.

Sterling slightly down as lower inflation rate reduced need for interest rate rise.

author: Joe Beardshaw

June 27th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Yesterday, November 17 London wheat closed down £1.25.

European wheat yield forecast has been reduced 0.05 t/h to 5.86 t/h due to dry / heat ( 5 year average 5.84 t/h). Barley also reduced to 4.7 t/h (5 year average 4.83 t/h); reports from France suggest disappointing barley yields.

UK crops are rapidly changing with concern about wheat and it is still June.

Russian crop potential good, but Ukraine may have been damaged by dry conditions.

US corn and soya markets are quiet but wheat is down, having recently hit 3 month high; the rise in wheat was attributed to funds reducing positions due to weather but now they are neutral.

USDA report this Friday will forecast planted areas, it is expected to be a big increase in soya area, production estimated 4.43 – 4.50 billion bushels (consumption 4.23 ).

author: Joe Beardshaw

June 15th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Yesterday, London November 17 wheat closed up 60p.

US markets retreated after recent rises with better weather (rain) forecast. However, corn remains in an uptrend and spring wheat yield is forecast at less than 40 bushels (last year average 47 bushels), rain forecast maybe too late; stocks tightest for 20 years.
Soya plantings could equal corn acres which will be revealed in USDA report June 30th; wheat and corn bullish, soya bearish.

French wheat crop nearly 1 week ahead due to conditions, possible early harvest. Recent French crop tour of barley crops indicated average quality and yield potential due to drought, frost and recent heat. Spring barley 10 days ahead of normal.

UK wheat crops benefitted from recent weather and some estimates talk of 15 million tonne crop.

Russian spring barley area smallest since 1970.

US FED raised interest rates 0.25%, this should strengthen $; strong $ is traditionally bearish to agricultural commodities. Sterling has found some stability; c. 88p against euro as election result is digested but Brexit negotiations could exert further pressure.

Threat of glyphosate ban; according to experts (chemical companies!), if implemented it could see a 20% reduction in UK wheat crop and 5% fall in barley.

author: Joe Beardshaw

June 13th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down 50p yesterday; global markets retreated despite continued sterling woes.

UK politics remains messy, especially with Brexit negotiations imminent keeping sterling weak.

UK imported 209,200 tonnes wheat in April (main suppliers Romania and Denmark), this made UK a net importer of wheat for the season. Decent volumes of corn have also been imported.

The rise of US markets ended abruptly as better weather forecast and bearish sentiment resumed. Overall crop ratings are significantly worse compared this time last year, corn is below alleged production costs and farmers are not selling.

Recent rains have raised EU crop prospects as other origin supply have fallen.

Despite weak sterling and good demand to Spain / Portugal for barley, prices have not improved, but should do with Black Sea supplies destined for Saudi and China.

author: Joe Beardshaw

May 23rd

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up c. £1.50 yesterday, weather and politics were the main influence.

UK old crop wheat has lost momentum as meagre demand has not been helped by imports; old crop premium to new crop may erode.
Rain and present warm weather will see crops quickly progress; the rain has alleviated concerns but yield may have already been lost and further rain will be required.

Europe has also had beneficial rain but recent forecasts have seen production downgraded, Strategie grains reduced EU grain production by 3.6 million tonnes to 301.6 mmt, however this is still up 4.5 mmt compared to last year. MARS, the EU monitoring service, also reduced production in western Europe due to dry conditions, especially Spain. Spain’s barley yield is estimated 2.5 t/h, down .46 t/h from previous estimate and down 30% year on year.

French wheat rated 75% good (this time last year 85%) winter barley 78% (93%), spring barley 67% (84%). However last year French crop problems started in June with heavy rain and a lack sunshine.

EU barley production will be down and the differential to wheat reduced, especially with news that Saudi has bought 1.5 million tonnes for July – August arrival, origin not specified.

US markets have risen as continued weather prevents corn drilling and the planting deadline is soon approaching. Funds are short and if they try to reduce positions it is another bullish factor. Egypt buys US wheat (295,000tonnes), first time for 2 years undercutting Russian and Ukraine supplies.

Trump continues to make headlines. he declared US would pull out of trans –pacific trade agreement. The other 11 members say they will continue if necessary without US.

Sterling falls and the ‘experts’ have changed their opinions, they think sterling is overvalued.

author: Joe Beardshaw

May 05th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat fell 65p yesterday as markets lost momentum

US wheat was sharply down, losing most of the gains from the early part of the week as the short covering petered out. Kansas wheat tour had reported optimistic yields but when all the data is analysed, production could be down 40% year on year.

Latest UN numbers has world wheat stocks up 3.3% for 2017-18 at 247.6 mmt, down 20 mmt year on year. Stocks have increased; wheat consumption has reduced, alternative grain uses have increased – bioethanol.

With all crop estimates there is a time delay and the UN data was compiled a few weeks ago, in the meantime weather has featured.

As a result of dry conditions, French wheat crop rating has reduced 7% good to excellent; winter barley and rapeseed (cold) has suffered greatest damage. Last month, much of France only had 25-50% expected rainfall. Spain, EU ‘s biggest grain importer, is getting to a critical point, crops are more forward and showing significant losses. The UK water shortage is making news headlines, suggestions of ‘hosepipe bans etc.

Sterling slightly down, France expects Macron to win Sundays election, this may support Euro. Early local election results give Conservatives gains.

Oil falls to 5 month low, down 4.78% (Brent $48.38) as world stocks build, US increases production and demand slips.

author: Joe Beardshaw

April 26th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London May 17 wheat was up £1.80 and November 17 + £0.55; the exaggerated May contract rise was technical, tender day is looming and ‘quirky’ values may continue for the next few days.

Currency and weather are the market drivers and in terms of £ / euro, currency had a benign day yesterday. UK annual government deficit estimated to be the lowest since 2008 financial crisis, borrowing has been reduced by £20 billion to £52 billion.

French wheat loading is destined for UK; UK old crop is stuck in a range, rising domestic prices together with stronger £ are attracting imports but the UK prices have a limited downside due to tight supplies.

Weather is increasingly becoming a feature, some areas of Europe are down 25-50% on rainfall, although cooler temperatures have reduced evaporation. May – June are the critical months when crop stress becomes a major threat; however some reports estimate 2 mmt barley and 1 mmt wheat may have already been lost in Spanish potential production due to a lack of rain.

US corn and wheat markets found support yesterday, mainly due to continued wet and cold weather delaying planting. Soybean oil also gained due to commercial buying and expectation of legislation / protection that may come in to deter Argentinean bio diesel ‘dumping’.

Oil up 1% with Brent crude $52

author: Joe Beardshaw

April 21st

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London old crop closed down 70p and new crop up 20p making May – November differential £9.00. Part of the reason for this contrast is sterling strength, it is provoking wheat imports into UK; 3000 tonnes French wheat loading following last week’s 4000 tonnes. Both Ensus and Vivergo are placed to take imports; Ensus can also use corn as well. UK supply / demand remains tight and any harvest date will be important.

New crop supported by continued dry weather concerns with parts of Europe only having 30% normal rainfall, North Africa is dry (Algeria , Morocco) having had no rain for last 30 days; rain prospects are limited for the next 10 days.

Heavy world supplies do offer insurance against weather threats, Black Sea exports are below expectation and therefore increasing stocks; Russian and Ukraine wheat production for 2017 crop will down due to weather, yield closer to normal and lower area.

US markets much weaker, Kansas wheat reaching new lows; recent rains have removed the dry threat that existed 1 month ago. Conditions for corn and soya planting are good, further helping the bearish sentiment, but this would be 5th good US harvest in a row, if conditions continue.

Canadian wheat area is down 3.7%; growers have switched to alternative crops such as canola, this is thought to be a reaction to low wheat prices.

author: Joe Beardshaw

April 12th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down 50p on old crop and down 25p new crop due to sterling strength and negative world markets.

Sterling rose with euro currently worth less than 85p as UK economic data shows support.

USDA report yesterday published bearish numbers but wheat actually closed up as there was some short covering rally. South American production at the high end of expectations (Brazil soya 111 mmt) and certainly much higher compared to this time last year. Soya traded at one year low; will this impact US planting intentions?

UK wheat supply / demand situation remains tight, especially if there are new crop problems.

Whilst plentiful global stocks weigh on sentiment due to ‘Good’ global harvests, the market remains nervous with an expectation, due to probability, of potential future weather threats. Although not critical yet, Europe is experiencing dry condition; conditions in eastern Europe need to be monitored.

Brent crude traded over $56 barrel, OPEC and non OPEC nations (e.g Russia) reduced supplies in March by more than they pledged.

Certain Japanese crisp brands have suspended production following the worst domestic potato harvest for 34 years.

author: Joe Beardshaw

April 03rd

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat was slightly weaker on Friday, this compounded losses for the week of c. £0.50, however Nov 17 wheat is this morning up 95p.

French wheat hit new contract lows, rated 90% good to excellent, down 1% from previous week. This time last year the rating was 92% good to excellent, so there is still plenty of time for things to change; certain areas of France could do with some rain. Putting aside potential 2017 northern hemisphere wheat crop, markets are still trying to digest the world wheat crop surplus of 2016; stocks to use ratio presently at 33%.

Friday’s USDA report saw a big increase in soya area (only .5 million acres less than corn) resulting in soya sharply going down; wheat and corn are up as their area declined. In 1990, wheat had the largest area then corn and then soya, it is now corn, soya and wheat.

Sterling has registered its first quarterly gain against $ since 2015; there is still much debate about currency, the range of views would indicate that no one really knows.

Oil prices improve as stocks reduced and supplies may be curtailed either for political or economic (OPEC) reasons.

author: Joe Beardshaw

March 17th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London May 17 wheat closed down 45p and November 17 wheat down £1.15.

Sterling gained on reports that the UK interest rates could rise with BOE committee showing sympathy for rate rise, Euro supported by Dutch election result.

US market held recent gains as export figures supported soya and corn (corn exports up 66% year on year); wheat still suffering dry conditions in plains.
Funds are 80% long on soya meal indicating bullish sentiment but also danger if no weather threat emerges, there could be panic selling.

Plenty of wheat buying, Algeria buying 480,000 tonnes after last month’s 585,000 purchases; Egypt has bought 1.68 mmt in last month’s tender.

EU wheat exports forecast to get back to 26 mmt next season as yields and quality recover from the 2016 harvest problems.

author: Joe Beardshaw

March 06th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Friday London May 17 closed down 20p and November 17 up 35p; UK wheat registered gains of c. £2.00 for the week however at the time of writing old crop has firmed up. UK old crop wheat is stuck in a range supported by a tight balance sheet.

European wheat crop potential looking good, French wheat rated 93% good to excellent; UK crops good apart from oilseed in eastern England. EU forecast EU wheat crop up 5.7% year on year at 143 mmt but this is below other predictions of 150 + mmt.

Sterling falls below 1.16 against euro but there remains split opinions on forward trends; sentiment that the euro is gaining and sterling is falling appears to be gaining traction, based on European voters rejecting anti EU policies; but we have seen how misleading polls can be!

US markets are quiet as changes to biofuel mandate appear to be a rumour and unsubstantiated. There is an expectation that the FED may raise interest rates, this would potentially strengthen $ and be bearish for agricultural commodities. If $ gains it would make European wheat; both euro and sterling when prices compared in $, more attractive.

China announces reduced growth for 2017 at 6.5%; growth in 2016 was 6.5 – 7%, the lowest levels for 26 years.

author: Joe Beardshaw

February 23rd

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat is not showing any dramatic price change, old crop down 20p and new crop up 20p.

Weather continues to be benign, but we are getting into the period when market volatility responds to weather and sentiment.

The big unknown factor on price direction continues to be currency; there is a conflict of opinion amongst currency ‘experts’, some are saying UK economy proving resilient and Europe is in election mode, so we will see sterling gain. Others say UK will suffer as Brexit proves difficult to implement and UK trade deficit will see sterling decline.

US markets are also quiet, although wheat did firm on cold conditions in US winter wheat area. Corn has quietly been trending higher for the last 5 months. USDA agricultural forum today / tomorrow will indicate planting intentions , likely to show record soya area.

Egypt buys further 360,000t wheat from Russia and Ukraine, this will bring weekly total to 720,000 tonnes. The season’s cumulative total is 4.6 mmt; this time last year 3.25 mmt. French wheat was price competitive at last tender but suffered from higher freight costs.

India may need to increase wheat imports as domestic supplies dwindle, but Australia will benefit from increased demand with bumper crop to distribute.

author: Joe Beardshaw

February 21st

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed c. £1 down yesterday as grain markets generally had a negative day.
UK old crop wheat is seeing little trade, there is no margin to export and domestic buyers are taking a low profile which maybe just as well with few farmer sellers.
Supply / demand situation does feel tight, further tonnage may not come to market until Feb sale contracts / pool commitments are completed; cash flow pressure not apparent.

With plentiful global wheat stocks and no real weather threats, sentiment on new crop is nervous / bearish. French wheat rated 92% good to excellent, and limited winterkill reported in Europe. Ukraine is the only area of concern, thick snow could cause snow mould if it does not melt and north eastern Europe (Germany – Finland) could benefit from some rain.

US markets were closed yesterday for presidents day, but markets were down Friday as funds reduced positions; US wheat too expensive in export markets and soya fell on big south American production. USDA outlook conference Thursday and Friday this week will indicate US planting intentions; how much corn land will be switched to soya as high oilseed prices attract growers.

Mexico may try to look to south America for wheat, corn and beef in response to Trump’s actions, but this maybe not be practical due to increased freight costs.

Virulent bird flu in China will see poultry production reduce, meaning less feed demand; bird flu may reduce soya meal demand 1-2 mmt.

The present strength of the UK economy may give chancellor Hammond some wriggle room, avoiding tax increase or service cuts in March budget.

In some areas of Russia, land prices have increased by 60% over the past two years, however Stockholm listed Black Earth had pulled out of Russia; Black Earth at one stage was responsible for 330,000 hectares. Western investors in Russian land have been replaced by middle and far east investment combined with domestic buyers; Russia now rank top wheat exporter.

UK single malt whisky export sales topped £1 billion for first time, total Scotch whisky sales of £4 billion have benefitted from weaker sterling (93% whisky exported).

author: Joe Beardshaw

January 13th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up £1.25 on old crop and up £0.85 on new crop making May – November differential £9.50. How wide can this spread become? Allegedly there are traders who see £10.50 as a trading spread opportunity.

Sterling falls below 1.15 against euro as Brexit concerns and current account deficit weighs on sentiment. There is talk that sterling may fall to $1.10 (currently $1.21); euro has its own concerns as attention switches to forthcoming French elections in April, what is the price on political risk? FTSE records 11th day running record close.

Yesterday’s USDA report caused some excitement, soya beans closing up 28 cents and wheat 13 cents. Soya stocks were reduced despite record harvest, 36% estimated available supplies were used in the first quarter, demand remains strong. Winter wheat area in US lowest since 1909. Whilst there is bullish trend appearing, there is still major concerns about possible trade conflicts / disruption when Trump takes control.

Extreme winter weather and strong winds are disrupting grain shipments from Eastern Europe.

UK rapeseed production for 2017 is estimated at 1.89 mt; down due to smaller area and crop losses. The reduced production should make the balance sheet tight and likely to see UK rapeseed markets at premium to Europe.

author: Joe Beardshaw

January 04th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up 45p on 2016 crop and up 25p new crop. The UK supply / demand looks tight; wheat from the south travels north to satisfy demand. Will Ensus continue beyond February and will Vivergo reopen increasing demand. The market has been supported by a lack of sellers. There is a lack of new export trade and limited to domestic demand, will this demand be able to absorb selling if / when it happens?

US markets saw corn up and soya and wheat down; wheat got some support from cold snap threatening wheat plantings prompting some commercial buying. There is concern over Soya, the March soya contract is close to the November contract low; funds are long and if this level is broken there could be panic selling on the back of sentiment change.

Sterling gains slightly on UK economic growth, although continued confusion / uncertainty about Brexit. UK barley at c. £17 discount to feed wheat looks a big differential and could see domestic consumers, where practical, increase usage.

Reports from Ukraine say wheat plants have higher sugar levels in tillering nodes which makes plants more robust and able to survive cold conditions; Ukraine wheat area + 2.2%.

Oil falls from 18 month high as stronger $ and Trump uncertainty affects markets.

author: Joe Beardshaw

January 03rd

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

2017 starts with some analysts (e.g. Goldman Sachs) predicting a bullish trend for commodities such as mineral and oil but not wheat and corn. Growth in the global economy combined with reduced stocks will support oil etc but record global stocks of corn and wheat weighs on sentiment.

US markets in 2016 saw corn down 2% during the year, soya + 14% and wheat -13%; markets not helped by stronger $.

World wheat supplies bolstered by raised Argentinean wheat harvest now estimated + 15 mmt (USDA 14.4 mmt). Western Australia also posting big harvest numbers.

Egypt buys 235,000 wheat all Russian apart from one Ukrainian cargo, surprisingly no Argentinean wheat.

Oil prices remains stables, markets wait to see if OPEC induced production cuts will be implemented in January.

This year is the centenary when Fitz Haber and Carl Bosch created the Haber – Bosch process, transforming air nitrogen into fertiliser.

author: Joe Beardshaw

December 29th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Yesterday, US markets lost some of the sizeable gains seen on Tuesday. Tuesday’s gains were not attributed to any fundamental change / reason but possibly more ‘book squaring’ before year end. $ closed against a basket of currencies at the highest level since 2002, curtailing the presence of US grain in export markets.
Corn is also weaker, there is speculation that the Trump administration is sceptical about ethanol benefits to the environment and may change ethanol mandate.

Wet weather in Argentina is hampering last soya and corn drilling but wheat area is up 20% (5.23 mh) which could see a production increase of 39% to 15.7 mmt, yields permitting.

Bird flu threat remains in EU, two wild birds in England and a third in Scotland have tested positive for bird flu.

Egypt announces it has sufficient wheat for 5 months.

Russian wheat exports reduce due to rouble strength; Russian economy is oil dependant and oil prices are stronger due to the reduced world production (Brent c. $57 barrel).

FTSE trades higher supported by strong mining company performance.

author: Joe Beardshaw

December 20th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

May 17 (16 crop) London wheat closed up £1.10 yesterday, Nov 17 (17 crop) up 30p, May 17 is £1.95 presently at a premium to May 18.

European commission says mild weather in EU and eastern Europe has meant crops have not ‘hardened’ off and increases danger of winterkill with colder weather forecast for Russia and Ukraine, especially with little snow cover. The situation was the same last year but damage was limited by lack of sustained cold weather.

US markets were down yesterday, especially soya which finally responded to big South American crops / supplies; rain has benefitted production potential. Fundamentals are negative, there is a bearish sentiment, although 50% of US hard wheat belt may have been damaged by cold conditions.

Investors have taken biggest long position in oil markets since July 2014, this has been as a result of Oil producers both (Opec and non Opec producers) cutting supply by 2 million barrels day.

Some analysts feel sterling is overvalued and maybe due a fall as Brexit situation develops; many EU countries are having elections in 2017 and may take a hard stance to negotiations. Low UK interest rates may provoke an even greater spending spree over Christmas, boosting UK economy but the repercussions may come later.

Interest rates and politics will continue to influence currency added to which recent events in Berlin, Turkey and Italian bank situation.

author: Joe Beardshaw

December 19th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed c. 50p down on Friday but was up 30p (2016 crop) and up 45p (2017 crop) for the week.

Exports from EU are slowing, wheat is up 1% year on the year, barley down 65% and corn imports down 19%.

French wheat area for 2017 has slightly increased; early crop forecasts are estimating 37.7 mmt compared to a disastrous 2016 crop of 28mmt. 2016 crop saw production at its lowest levels since 1993.

US markets showing some resilience, especially soya which should come under pressure from big south American crop, but it is at present holding up.

Last week US Fed increased interest rates; strong $ is generally bearish for commodities. Sterling remains stable at 1.19 against euro but struggles to break 1.20.

China may need to import 4 mmt of wheat; this year they had poor domestic wheat and corn quality.

Southern Russia has experienced cold temperatures (up to -18), with only 2 cm of snow cover, some damage may have occurred. Russia normally does have some winterkill and any damage does not become apparent until the spring.

Debate continues about the size of UK malting crop. Malting premiums have benefitted from weaker sterling and poor French crop. Big discount of feed barley to wheat may deter some spring barley drilling as risk is perceived too big if quality specification is not achieved. English spring area forecast is up but Scottish crop down as lack availability of malting contracts; open autumn and better wheat prices encouraged wheat drilling.

author: Joe Beardshaw

December 06th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down ~ £1 yesterday following last week’s losses that totaled c. £3.80. For comparison, French wheat was down €8.25 but rapeseed up €8.0

Sterling has now had 5 weeks up, the Eurozone is nervous with talk of referendums / votes taking place. Italian prime minister Renzi resigns due to referendum defeat; Italian bank shares fall sharply as they try to raise finances.

US markets are firmer, led by soya as commercial buying / exports improve.

Abares, the Australian farm ministry, raises crop forecast to 32.6 mmt (+35% year on year) from September forecast of 28.1 mmt.

Canadian wheat crop put at 30.7 mmt; largest for 3 years.

French wheat rated 94% good - very good; this time last year rated 97%, however 2016 French crop had problems; 22% early tillering stage.

Dry weather in South America has seen funds increase bullish position on soya.

author: Joe Beardshaw

November 28th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Friday trade was quiet with US markets closed for Thanksgiving, however London 16 crop closed up £1.00. Over the week 16 crop was up £0.80 and 17 crop down £1.00.

French winter wheat rated 94% good to excellent (98% this time last year) and winter barley 92% (98%).

Russian winter grain area put at 17.3 m hectares (up 1 million hectares).

Australian wheat crop estimated 28.3 mmt but this is considered low by Nidera (Australia), they are forecasting 31 mmt based on Eastern Australia reporting heavy yields.

Debate about size of Argentinean wheat crop; harvest 35% complete, range of 2.4 mmt from 12.5 mmt to 14.9 mmt.

Threat of bird flu in Europe increases especially Denmark and Finland; 100,000 turkeys slaughtered in Germany and an emu in Ueckermunde zoo dies from bird flu

Sterling remains at a 2 month high against euro (1.1750 / .8517), UK economy grows 0.5% in third quarter and business investment remains above expectation.

Francois Fillon wins French conservative nomination and will run in next year’s presidential elections to face Marine Le Pen, he promises fairer society saying ‘French people want truth and want action’.

author: Joe Beardshaw

November 24th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London markets had a quiet trading day yesterday, May 17 up £0.05 and Nov 17 down £1.25.

UK trade is, at present, mainly limited to domestic trade, Vivergo and Ensus requiring continued supplies.

Sterling rose in response to mini budget / autumn statement.

Euro nervous as Austria has elections on 4 December and far right candidate Hofer says he will call for referendum on EU membership; polls have it too close to call.

US markets tend to go dormant ahead of thanksgiving holiday, but renewable fuel mandate supported soya bean oil and corn (37% US crop goes for ethanol), despite $ reaching 13 year high in expectation of interest rate rise.

European wheat plantings suffered poor emergence due to dry conditions followed by wet weather that has delayed further plantings.

India may have to import an extra 5 mmt of wheat, this is above previous estimates due to poor domestic crop.

Glencore ship 53,000 tonnes French barley to Saudi; French barley shipments have been down as China have used corn instead of barley.

author: Joe Beardshaw

November 17th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down yesterday, old crop down 25p and new crop (2017) down 70p.

UK exports for September show total of 712,000 tonnes so far, this does include a volume of old crop shipped in July, UK exports benefitted from post Brexit sterling weakness. Imports were down 23% year on year for September but these figures would indicate a tight balance sheet going into new year.
New wheat export business from UK is presently struggling due to cheaper alternatives and cheap maize supplies; Ensus could switch to maize if wheat supplies prove difficult to source.

US markets are down, the $ reaches highest level since December; all agricultural commodities (apart from cocoa) are $ denominated and will suffer if $ strengthens. Speculation continues about Trump economic policy and possible tariffs. 75% US farmers voted for Trump as he promised tax cuts for family farms.

Australian wheat crop estimates remain at 27.6 mmt but harvest is slow, eastern Australia is 3 weeks behind; wet weather has helped yields but threatens quality.

Romania may be unable to drill 10% winter area due to weather. Russian and Ukraine crops are potentially looking good but presently colder than average although there is some protection from snow cover.

Scottish spring barley crop from 2016 harvest estimated at 1.3 mmt, lowest total since 1998 and 17% down year on year; fall due to reduced area and lower yields.
Distilling demand has increased as plants come back on stream after maintenance and whisky demand increases helped by exports. Counter to the potential increase in demand, the area of spring barley is anticipated to continue its increase, with the 2017 UK area forecast to be almost 17% higher.

author: Joe Beardshaw

November 16th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up £1.50 on old crop and up £0.90 on new crop.

Sterling was weaker, inflation slowed in October, this has reduced chances of possible rate rise and reports about Brexit ‘chaos’ has had a destabilising effect.

UK wheat, even at current sterling rates, are being undercut by Baltic / Black Sea origin, this is also being coupled with cheap corn supplies.

There are big boats due to load in UK pre xmas from previous business; the supply / demand situation looks tight into new year.

US markets had a turnaround Tuesday, corn, soya and wheat all up. There are heavy corn stocks, will any rally be sustained long term, especially if $ firms?
Speculation about Trump effect; infrastructure spending and possible tax cuts will help economy.

Whilst European wheat stocks are getting tighter there is still plenty of wheat in rest of world.

Oil firms up as OPEC again talk of limiting supplies but it is doubtful they will want to drastically reduce oil income.

author: Joe Beardshaw

October 25th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed virtually unchanged yesterday as stronger sterling was countered by tight domestic supply and little farm selling.

Sterling is c. 89p against euro, the euro under pressure and was sold after Draghi comments. US election and continued Brexit negotiations will mean currency is likely to remain volatile.

The weak sterling has significantly assisted UK export growth, speed and volume of orders has been the highest for 2.5 years.

US markets saw corn and wheat down but soya is up as a result of vegetable oil market. The recent rise in US wheat prices has been due to shorts reducing / buying back their positions; short positions in wheat have been cut by nearly 50% in the last 2 weeks.

Third wheat boat in UK loading for Algeria with fourth also due. Black Sea wheat prices are up as are global corn prices; UK wheat should be underpinned by relatively weak sterling and good quality.

Whilst UK values have improved there is still a world glut of grain in stocks, although a lot of this stock is in locations that make verification difficult (China, Russia etc).

author: Joe Beardshaw

October 17th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat continued its upward trend closing up £2.20 November 16, gaining £5.05 for the week. However, the November contract has also been pushed up on technical reasons and other forward contracts did not achieve quite the same increase.

UK wheat continues to benefit from weak sterling, recent reports stating UK economy is in for prolonged weakness due to reduced consumer spending and lower investment. Bank of England has spent £1 billion buying corporate bonds to protect economy. During this period of a weaker sterling there has also been a reduction in migrants; is the UK now not seen as such a good destination / earning opportunity?

EU wheat exports are 17% ahead of this time last year, despite little French volume. The USDA has for the season EU exports 28% down year on year; if current pace continues stocks will be tighter.

US markets are firmer, ignoring last week’s bearish USDA report; Dec corn 2 month high and Dec wheat 7 week high. The market is supported by nervous short covering and increase exports; US wheat cheapest priced wheat in Egyptian tender but lost out due freight (Egypt bought Romanian & Russian).

French winter wheat 23% planted (34% last year) and barley 39% (54% last year).

La Nina and drought threat is still in the news but this has featured for a while and possibly accounted for in the market.

Brent crude c. $52 barrel

author: Joe Beardshaw

October 12th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up £1.15 yesterday despite sterling stabilising. Funds are short covering in U.S and Paris supported market.

USDA report is due today, this has made markets nervous and funds are reducing their position. The October USDA report tends to have market impact as production and yield more reality rather than projection. Soya yields expected to increase but how much of this is factored in?

UK wheat exports for season have been put at 457,000 tonnes (including 80,000 to France) but this includes a chunk of old crop.
Weak sterling and good quality is making UK wheat attractive but there still remains a lack of farm sellers.

Egypt, despite ergot problems and cash ‘tightness’, projected to import record amount of wheat (11.8 mmt?) due to growing population; currently imports are behind last year meaning acceleration maybe required.

Oil trading at $52 barrel, Russia has announced it may join OPEC. Stronger oil prices firms rouble making Russian wheat more expensive in world markets.

author: Joe Beardshaw

October 10th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up £1.20 to register gains of £2.25 for the week; French wheat was €3.50 down for the week.

Since the Brexit vote, Sterling is down 17% against $ and 14% against €. U.K wheat has risen 12% since the vote and French wheat has declined 4% highlighting currency impact.

French wheat exports are down due to poor quality and stronger currency a drop of 20% year on year; only 25% of French wheat is making 76 kg/hl against 80% last year. France has smaller crop but imports are up, wheat from places like Romania are bought for blending. The demise of French exports has benefitted Russia; Russia are gaining a bigger share of export market.

US markets tried to rally on Friday but closed down (e.g soya 18 cent range on the day). Funds increased their short position on wheat which will provoke short covering / correction at some stage. Poor jobs data has reduced the expectation of an interest rate rise. October USDA is on Wednesday, this may have a major impact as it will publish harvested acres, yield and production.

French winter wheat 6% planted against 17% this time last year; dryness continues to cause delays. Dry weather is also affecting maize harvest, EU crop further reduced 2.8 mmt to 59.7 mmt

author: Joe Beardshaw

October 06th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed unchanged yesterday but has gained £1.70 so far this week, the main driver of this increase is a weaker sterling; to put this in perspective, sterling reached a 31 year low against $. The weaker sterling has come about as Brexit continues to gather momentum and as markets speculate. However, sterling slightly recovered yesterday as economic figures of UK growth were encouraging and FTSE soars.

UK wheat markets continue to cope with a lack of farmer selling; wheat exports from UK are estimated at 600,000 tonnes July – September, 300,000t were old crop in July.

Corn, soya and wheat have at some stage this week each provided support to the US markets. Extreme weather approaching South East America may damage soya and corn in these regions that has yet to be harvested.

Dry conditions that have caused planting concerns in Eastern Europe are also now affecting Western Europe, rain is needed in France.

UK land values fall as commodity values decline. Farmers are still the biggest buyers of land but now account for less than 50% of all farm sales; cash flow problems are enabling institutional investors to acquire. April – June 2015 English land prices averaged £10,700 acre; July – September 2016 average sale value £9,300 acre.

Oil firmer with Brent crude close to $50 barrel

author: Joe Beardshaw

October 03rd

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up 5p on Friday to bring the weekly gain to 35p but up £4.10 for September.

London markets were helped by sterling which fell sub to 1.15 (.8650p) against euro as Brexit gathers pace.

USDA report on Friday was neutral for corn and soya but wheat stocks were up 21% year on year, they are at the highest level since 1998; US markets however closed marginally up on Friday.

IGC predict unchanged winter wheat plantings (northern hemisphere) for 2017 crop. Low prices for wheat have been countered by weaker currency for some producers / exporters

Planting in Ukraine and some parts Russia hampered by dry conditions; Ukraine are behind on last year and 2015 planting was also a very bad year but saved by sympathetic weather!

German firms rally around to support Deutche Bank.

Oil c. $50 barrel

author: Joe Beardshaw

September 27th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat traded down £1 yesterday; despite sterling reaching 3 year low. Sterling suffered from fears of exclusion from single market and ‘fragile’ balance of payments.

EU harvest yields have been further reduced, wheat 5.63 t/h (5.86 t/h last month); corn 6.84 t/h (7.23 t/h),barley 4.77 t/h (4.88). However, all world wheat producers apart from Europe have had bumper yields following previous 3 – 4 good years.

US markets were down as weather sympathetic to harvest and US soya not such discount to Brazil as previous (was 60 cents currently 22 cents)
Wheat values near 10 year low.

Concern about a dry autumn is threatening Russian and Ukraine wheat drillings. Rain is forecast so the threat may diminish; Russia is 50% winter planted. Russian wheat area expected +6%; a weak rouble has helped wheat exports encouraging planting. Russian wheat (+1.2% last week) values have improved; Egypt buying Russian wheat again.

Sterling is weak but Eurozone has its own problems, Deutche bank shares have fallen 50% this year due to fines over irregular trading and Merkel says the government will not step in to support; state support would be in conflict to German government views regarding south European banks.

author: Joe Beardshaw

September 20th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up 80p yesterday following last week’s £2.25 rise; much of this rise attributed to weaker sterling. For comparison, Paris wheat was up 0.75 euro (c.65p) on week.

UK wheat has been supported by a lack of farmer selling and Ensus (bio fuel) demand for wheat, prices in the north east are becoming a premium market; this will mean wheat is hauled further north. Trade is assumed short of November futures, there could be rush to cover shorts especially if physical hard to buy.

French corn harvest is due to start, yield is anticipated to be further reduced.

US markets higher, especially soya which responded to firmer soya oil / vegetable oil, markets which are close to 2 year high. Wet weather delaying US corn harvest causing shorts to look nervously at their short positions.

Australia still expecting big wheat crop but quality may suffer as la Nina gains power.

EU wheat quality down this year, estimated 29% milling quality against 41% last season.

Egypt, the world’s biggest wheat importer, has failed in its last 3 attempts to buy wheat, zero tolerance on ergot deters sellers.

author: Joe Beardshaw

September 15th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed 25p down yesterday; the differential between Nov 16 and Nov 17 c. £8

UK wheat values are being supported by weaker sterling, spot demand to fill boats and reluctant sellers. Bank of England is due to meet today, current interest rates are expected to be maintained, a ‘dovish’ statement is expected and will keep sterling weak.

French 2016 wheat crop estimated 13 mmt down year on year (41 mmt v’s 28), exports down 43% sub 12 mmt. French average wheat yields 5.45 t/h, lowest for 33 years;
Uk wheat crop estimated 14.5 mmt.

French wheat is being exported to Eastern European homes; India importing Ukrainian wheat!

US markets are lack lustre after bearish USDA report (ample supplies), however rain is delaying corn and soya harvest. Funds are at a record shorts and at some stage they will need to reduce positions / take profits, this would cause a buying surge and potentially influence UK prices.

Recently planted Ukrainian crops are being threatened by dry conditions; same situation happened this time last year, but crops recovered.

Romanian trader demands $500,000 compensation for cancelled cargo or ‘performance bond’ due to ergot problems. Russia threatens to ban Egyptian citrus products.

Oil weaker at $46 barrel.

author: Joe Beardshaw

September 08th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up £1.50 yesterday as sterling was slightly weaker and some bullish influences appeared.

French corn crop put at 12.5 mmt which is 7% down year on year ( and 3% lower than august estimate) and smallest crop since 2003. Whilst 40% French corn is irrigated, dry weather has reduced yield.

Russian wheat production estimated at record 72 mmt but Russian exports are currently behind last year. Stronger rouble, variable wheat quality and logistical problems may make it difficult for Russia to gain greater market share into certain destinations.

Dry conditions in Ukraine hampering planting of wheat crops for 17 crop (same as last year but crops exceeded expectations).

US markets higher due to better exports and wet weather delaying harvest

Ensus , UK bioplant and big user of wheat ‘may’ continue production beyond October.

Oil firms up, brent crude c. $48

author: Joe Beardshaw

September 05th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed 25p down on Friday, bringing the week’s losses to £3. Much of the decline has been attributed to sterling strength, bolstered by positive domestic economic reports, although the current G20 meeting has indicated concern about UK Brexit.

Australia forecast to possibly beat previous wheat harvest record (2011-12 29.6 mmt) due to favourable weather conditions.

India, the world’s second biggest wheat consumer, may need to import up to 6 mmt and may scrap import tax. Last time they had to import this volume was in 2006-7 when wheat prices rose 50%; however this year Australia will be well placed to fill this demand if harvest forecasts become reality.

Russia may suspend wheat export tax for 2 years (Sept 15th 2016 – 2018) due to good current wheat production.

Argentina due to increase wheat area by 20% to 4.3 m hectares.

US markets closed for Labor Day. Corn and wheat bounced from contract lows despite crop tours indicating big yields. US markets have been supported by soya which has followed vegetable / palm oil markets up, despite big soya crop. Palm oil +18% year to date; soya oil +7% year to date..

China plans to dramatically increase domestic oilseed production over the next 4 years to reduce reliance on imports.

Oil currently c. $47; prices stabilised after Putin suggested Russia and OPEC should agree to limit supplies to support prices; Iran exempt as they rebuild production.

author: Joe Beardshaw

August 25th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down 85p yesterday as sterling gained strength and export demand remained thin.

Sterling found support (3 month high) as UK economy is showing resilience post Brexit and export trade has benefited from weaker sterling.

Debate about size of UK wheat crop ; whilst quality has exceeded expectations, lack of farmer selling and stores not filling indicate lower yields.

French corn yields reduced 3.6% due to dry weather and crop ratings down; 40% of French corn is irrigated.

Lack of export demand is illustrated by Egypt not buying at latest tender and Syria postponed.

US markets drifted; soya has been the market driver but is close to significant resistance levels at $10.25. Wheat exports are better than previous season.

Some investors predicting agricultural commodities are investment opportunity against other commodities such as gold.

author: Joe Beardshaw

August 18th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up yesterday £1.05.

Exports of wheat are happening from UK but this is mainly old business being executed. Despite weak sterling, the UK is struggling to compete with Baltic and Black sea supplies.

Sterling near 3 year low against euro despite positive employment figures. Analysts and speculators are very bearish to sterling, but this is not totally due to Brexit as last time they were positive / bullish was November 15.

Germany continues to reduce wheat production; barley down 9%; corn down 12% and oilseeds down 11%. Comparing 2016 and 2015 is distorted because of exceptional 2015 yields.

Russia increases production estimates with wheat raised another 1 mmt to 70 mmt.

US markets were firmer as oil crops markets support other commodities. Export figures soon to be released are expected to be bullish.

Weaker sterling will increase CAP payments to growers by 15% (payments in euros; when converted to sterling) but input prices (imported) likely to increase.

author: Joe Beardshaw

August 11th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up £1.75, benefiting from a weak sterling (1.1645 / .8588 against euro) that suffered from negative economic news (trade deficits / government bonds).

French wheat crop now estimated at 28.68 mmt, exports projected down 60% to 5.81 mmt from last season’s 12.81 mmt; for first time ever, France will not be Europe’s biggest exporter, it will be replaced by Germany. The void of French exports are likely to be replaced by Russia or even US.

First UK wheats are of good quality and pleasing yields but the ‘bulk’ of the crop are unknown as yet.

Rumours are that Egypt has rejected Russian wheat cargo on quality issues.

Wheat production of Baltic countries are forecast down 9.5% year on year, this is largely due to heavy rains seen over the last 3 weeks.

With wheat harvest underway, attention is switching to corn, reports are that French corn yield maybe reduced by recent heat.

Australia is anticipating a bumper wheat crop as rains fall in east. Considerable rain fall has been attributed to strengthening la Nina; big Australian harvest coincide with la Nina influence.

Brent crude c. $44 barrel

author: Joe Beardshaw

August 08th


Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down 45p Friday but gained £1.30 for the week.

French farm ministry put French average wheat yields at 5.57 t/ha meaning a 29.1 million tonne crop; worst since 1980.
French wheat harvest 62% complete, however corn crop rated 71% good to very good versus 58% this time last year.

60% UK barley cut, yields estimated 5.9 t/h – 6.3 t/h against recent average of 6.8 t/h. Oilseed average yield 3.1 – 3.3 t/h (recent 3.6 t/h). Wheat area 1.794 million hectares x 7.5 t/h (estimated) = 13.455 million tonnes (last year 16.44 mmt).

Russian harvest progressing, bumper crop of 70.1 m/t anticipated; Western region quality down to rain increasing feed grade rather than milling.

US markets firmer, despite good growing conditions. Soya up on export sales; China may increase soyameal imports and reduce DDG’s (produced from corn). Problems with western Europe raise hopes of wheat exports to north Africa. Non-commercial remain long in soya. Latest favourable US employment numbers increase possibility of interest rate rise = stronger $= bearish agricultural commodities.

Brent crude trading c. $45 barrel

author: Joe Beardshaw

August 03rd

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up yesterday 55p.

Sterling recovered despite expectations that the Bank of England will cut interest rates tomorrow. Carney due to deliver statement on plans to tackle weaker growth and faster inflation post Brexit. £ v’s $ has been trading in a narrow range after Brexit reaction but US has own election situation / nerves.

Despite their big yields, Russian and Ukraine wheat values are firm (Ukraine + 2.2% last week) as smaller French crop removes competition increasing demand for Black Sea supplies. Recent Egypt tender saw only 60,000t Russian wheat bought with no French offers; prices 4% higher than week before.

US markets are weaker as latest USDA crop ratings is 72% good to excellent. Soya prices are down, there is no bullish argument apart from the speed at which the price has declined and non-commercials are still long, this could be price pressure if they try to liquidate; resistance levels are broken.

Early UK wheat reports are encouraging but overshadowed by doubts after French crop yields / quality; will UK follow pattern?? Following on from this there are also concerns about Baltic quality beginning to circulate.

Oil under pressure (Brent $42) as global supply glut and slow demand weighs on sentiment.

author: Joe Beardshaw

August 01st

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat traded up 70p on Friday but closed down 35p for the week.

Market conflict between bad yields in France and robust results elsewhere – Russia and Black Sea.

French crop rated worst since 2003 despite record area. French wheat quality down 2%, now rated 42% good to excellent; 77% this time last year.
Imports likely to rise, France normally imports c. 200,000t premium quality milling wheat; but quality will be helped by carryover stocks of 4.9 mmt, Matif wheat values have climbed by 7% since July 1st

Encouraging German wheat harvest results, as are early UK reports.

World grain production for 2016-17 increased by 20 mmt to 2.046 billion tonnes, within 1 mmt of record high set 2 years ago; demand also increased to exceed 2.0 billion tonnes. Wheat increased to 735 mmt (increase in Russia and US); Russia forecast to harvest 69 mmt. Increased wheat use as competitive to corn.

US markets stabilised on Friday, soya showing a bullish reversal as commercial buying appeared. Weaker $ also helped ag coms, bearish US GDP figures compared even to EU sector.

Argentinean wheat planting delayed by rain.

author: Joe Beardshaw

July 27th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down £1.35 yesterday as markets calmed down after last week’s recent sharp rise the rise was provoked by pessimistic yield reports from France (French wheat 5 month high on Fridays close).

French yields are significantly down with some production forecasts suggesting 30 mmt crop. Production helped by French wheat area at historic high and crop comparisons distorted by last year’s yields being extremely high, above 5 year average.

UK winter barley yields and quality are disappointing and following the French crop results. Opinion is UK wheat will follow trend due lack of June radiation. A reduction in production combined with active July shipping programme (aided by weak sterling post Brexit) will see UK exportable surplus greatly reduced.

Whilst western Europe has suffered, Russia and Black sea are experiencing, allegedly, good yields and are aggressive sellers (£120 fob?), capping the bullish argument from France, Germany, UK etc.

Global grain production for 2016-17 estimated second highest ever

Australia creating emergency storage as they brace themselves for expected record crop.

Rise in wheat prices has narrowed price difference to corn and wheat tends to follow corn. Whilst there is still time before harvest, reports for the corn crops are potentially good.

First results from English spring barley are encouraging, good grain size, low nitrogen’s and average yields but very early days.

US markets down as weather favourable to corn and soya crops.

Brent crude remains c. $45 barrel.

author: Joe Beardshaw

July 07th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

November 16 London wheat closed up 15p yesterday.

US markets were down but the slide slowed. Much of the US markets fall was attributed to non-commercials / funds long liquidated positions. Hot dry weather was forecast 2 weeks ago and funds took 5 year high long positions, since then, wetter milder weather has reduced threats to crops. Soya also found support from technical resistance levels.

Conjecture about UK wheat quality and yield; assuming 14.5 mmt wheat crop, a fall of 3 kg/hl from assumed weights would reduce crop by 4%, c.580,000 tonnes.

Sterling weak and UK wheat quality better than French; this may provoke export interest. French wheat production reduced on weather conditions.

UK wheat supply / demand influenced by bio fuels with Ensus starting production again. Ensus benefitted from lower raw material price but bio fuel production dependant on EU mandates and Brexit impact.

Black sea poised to be biggest global grain shipper.

Brent crude c. $49 barrel

author: Joe Beardshaw

July 05th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Having registered a fall of £1.50 last week, yesterday November 16 wheat closed up £1.25. Sterling tried to strengthen in response to economic comments from Osborne, but then fell. Analysts are split between whether sterling has been oversold and could bounce or whether further decline expected. Carney hinted at rate cut sooner rather than later.

US markets were closed yesterday, national holiday; corn is pollinating and soya pod is set so all attention is on the weather. US weather for corn belt over the next 7 days indicates slightly higher than average temperatures but some showers. Soya markets supported by soya oil exports; exports are up 39% year on year, Mexico number 1 destination

Strategie grains reduces EU rapeseed production, down 3.1% to 21.24 mmt with average yields 3.37 t/h; production lower than other forecasts.

French wheat good to excellent down 6% at 65% due to continued wet weather; barley is also downgraded 5%. Algeria is the favoured destination for French wheat. Algeria may need to import 8 mmt, a big increase but French quality could struggle to reach required specification.

IGC put global cereal crop second biggest on record, production 16 mmt above consumption.

Favourable weather has raised Russian crop production. Extra production combined with falling prices could increase exports 26.5 mmt wheat in 2016-17 (24.6 mmt 2015-16). Despite reduced area and dry autumn Ukraine may produce similar sized crop to last season.

Brent crude remains c. $50 barrel

author: Joe Beardshaw

July 01st

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

November London wheat closed down 10p, although other positions showed positive gains. UK wheat was boosted late in the session by Governor Carney hinting at interest rate cuts this caused sterling to fall but has since largely recovered.

Yesterday’s USDA report saw a big uplift in soya as planting increase was not as big as expected, growers did not switch out of corn due to rotation, pesticides etc. 3.5 m acres has come back into production, weather prevented cropping last year, however soya area is still up. Dry forecast for U.S has also lent support especially soya where demand is robust.

Apart from interest rate threat, the U.K saw current account deficit (value imports v’s exports) at record levels; economy grew 0.4% first quarter 2016.

Coceral raise EU 28 soft wheat production by 3 mmt to 148.01 mmt (1.35% below last year). Corn up 6.56% to 62.36 mmt and barley also increased 4 mmt, both of these compensate for wheat decline year on year.

Glencore hails ‘window of opportunity’ for UK wheat exports as cheap freight, ample supplies and weak sterling enable opportunities. A 70,000t vessel is due to load next month at Immingham, bound for Vietnam; traditionally UK exports target European homes.
Differential between wheat and corn values also helping as consumers switch to wheat. If UK production is down this harvest, it will see reduced surplus but carryout will still be up due to old – new crop premium incentive.

The EU has seen its credit rating fall from AA+ to AA; financial and economic uncertainty prevails.

It has been reported that the ozone thinning in the Antarctica is slowing (thinning since 1980’s) the thinning has been blamed for some of the extreme weather .

author: Joe Beardshaw

June 17th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London November wheat closed down £1.60 yesterday as agricultural commodities suffered falls, this was largely due external influences rather than fundamentals.

US markets traded sharply lower on opening before recovering but still down for the day, losses have been attributed to funds reducing their positions as they are nervous of imminent Brexit vote and the potential impact on financial markets. Non-commercials are holding major positions and the markets can be directed by non-fundamental influences.

Weather forecast for US could indicate ‘flash drought’ before late summer rains; however currently soil moisture is generally good. Concern will increase if the dry period coincides with corn pollination; hot dry weather at this stage can reduce yield.

Strategie grains reduced their total estimate of French and German wheat crop by 1.3 mmt, this is due to rain and lack of sun. Malting barley prices have firmed as wet weather increases fusarium risk in spring barley.

Wheat harvest forecast 10 days late

author: Joe Beardshaw

June 09th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

The upward momentum continues with November 16 London wheat closing up £2.20.

Markets are weather nervous; US mid-west has potential drought concerns, quality & yield issues for French wheat crop and conditions in Russia and Ukraine are wet, these are all feeding the bullish sentiment.

US markets are firm, especially soya, but wheat closed at highest level for 7 months. Funds remain active, driving the market before tomorrow’s USDA report.

Chinese demand improves, May’s monthly imports are showing oil up 38.7%, iron ore + 22.4% and copper + 18.6%. Soya imports are up 8.3% on last month and + 25% year on year.

Brent crude has established itself above $50 at $ 52.72 barrel.

Sterling continues to react to latest polls, recent poll showing 43% remain against 42% leave, although bookies still have remain as favourites.

Black grass remains serious problem with UK wheat crops, there is an increasing concern of a potential EU ban on glyphosate.

Egypt rejects Polish and Canadian wheat cargoes due to ergot contamination.

Reports of US crops rotting in fields due to lack of migrant labour as reaction to Trump rhetoric.

author: Joe Beardshaw

June 07th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London November 16 wheat closed up £1.85 on the day, but did reach +£2.65 at one stage before retreating. Combination of crops and currency giving market impetus.

Rain in France has seen rapeseed forecast yields reduced 4.9% compared to last year (although area +1.2%) and barley yields reduced 6.1%. Wet weather and associated problems has provoked this cut and wheat likely to follow.

Russia, Ukraine and Black sea also suffering excessive moisture with concerns on yield and quality. Russian wheat prices have risen as the saying ‘rain makes grain’ appears to be ignored

US markets also up but soya’s rise has slowed. Corn demand is good due to Brazilian crop concerns; funds buying to reduce wheat short as wheat cheap alternative to corn.
Reports of drought in mid-west due next month; USDA report due Friday which may give market direction.

Brent crude trading over $50 barrel at levels last seen November 4th 2015.

Sterling recovered slightly but remains under pressure, poll has 45% out and 41% remain.
$ reacts to vague comments by Yellen of no time scale for interest rate rises; weaker $ beneficial to agricultural commodities.

author: Joe Beardshaw

June 06th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

November 16 London wheat closed up 70p on Friday, bringing weekly gains to £3.10.

Bloomberg commodity index, which comprises of 22 raw materials, has registered just under 20% rise since January; 20% rise would signify ‘ a bull trend’.

UK markets helped by sterling weakness (euro 1.2677 / .7888p) as Brexit gather support with latest poll showing 45% leave.

European wheat reached a 5 month high as exports continue to erode stocks.

French wheat ratings down 2% to 85% good compared 89% this time last year; further downgrades expected. Barley down 10% to 78% compared last year 83%. Wet weather will potentially increase threat of disease and quality issues; further showers for France forecast. Poor quality wheat in France could compete with UK export markets.

Excessive rain is also a problem for Russia which is causing problems for corn planting; some areas of the Black sea region experienced 4x average May rainfall.

US markets continue to be supported by soya (Midwest drought), but some analysts feel soya maybe topping out, surprisingly US wheat closed at a 6 week high despite bearish fundamentals. Weaker $ due to employment figures saw potential interest rate rise recede; weaker $ helps US commodities.

Brent crude remains in $49-$50 barrel range

author: Joe Beardshaw

June 03rd

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat continued the rise from Wednesday, November 16 wheat closed up £1.60. Wheat found support from other commodities rather than significant fundamentals.

US soya was yesterday up 44 cents / bushel due to concerns about mid-west drought and strong world demand for meal and protein. This increase has dragged up corn but wheat is becoming an increasingly cheaper alternative.

Latest UN forecast has world wheat production for 2016 showing 6 mmt surplus for production over demand, but there are concerns about crops in Canada (Alberta), Brazil and North China.

Extreme rainfall in France (up to 3x average rainfall in May for some areas) has seen some downgrading of yield and quality, some estimates are putting wheat crop down 6.3% compared last year; drier weather is forecast.

UK wheat finding demand, 3 UK vessels are allegedly to load for Asia in June. Higher protein of UK crop giving advantage over Danish supplies and Baltic offers have reduced.

Sterling slightly weaker on continued referendum views; it is estimated an exit vote would weaken sterling 9% and an in vote would strengthen 4%.

Australia forecast to have best wheat crop for 5 years, up 10.7% due to sufficient rain.

Oil slips below $50 as OPEC do not impose output ceiling, feels markets are improving.

author: Joe Beardshaw

May 31st

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

UK and US markets were closed yesterday; Paris was open and registered 0.50 euro losses. London wheat closed Friday down £0.05 on the week and down £1.85 from close on April 30th 2016

French wheat rated good to very good down 2% on week at 83% compared to 91% this time last year.

Mars (EU forecaster) has raised EU 28 wheat yield to 5.85 t/h (+4.5% against 5 year average) but below 2015 crop of 6.02 t/h. Barley yield at 4.99 t/h +5.7% above 5 year average.

UK barley differential to wheat (new crop) reduced to c. £7; £6 would see maximum inclusion in rations; this time last year differential was £18 for 2015 crop.

June forecast for eastern and northern Europe is for warmer than average conditions

Russia anticipating record grain crop of 109.3 mmt (record 108.2 mmt 20080; last year 108.8 mmt, production boosted by corn potential but wheat likely to be second biggest ever

UK exports have reduced carry out to 2.5 mmt up 3% year on year; exports put at 2.75 mmt?? (imports hefty). Barley exports at 1.90 mmt at 19 year high and 27% up on 2015; end of season stocks down 30% compared 2015 at 1.01 mmt.

US markets supported by corn and soya, demand for soya meal has raised prices 54% in 2016 alone; high meal prices has increased corn demand as an alternative.
Ethanol producers are benefitting from higher oil prices with added bonus of rising DDG prices, demand for meal and DDG’s likely to support wheat if price differential continues to increase.

Brent crude hits $50 barrel, first time this year and oil price sup 85% from February lows.

Sterling remains firm on anticipation of remain vote but debate gets increasingly vitriolic and many polls indicate a close prediction, the decision may depend on voter turnout.

author: Joe Beardshaw

May 25th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed down 25p yesterday as sterling gained strength, according to recent polls the ‘remain’ vote made ground.

At present the wheat potential is not suffering any crop / weather threats and pacific cooling signifies El Nino is over; however cooler pacific could provoke La Nina which would also bring dry conditions to northern hemisphere.

US markets traded initially down and then recovered. Soya supported by meal demand, wheat is at low levels with Kansas city wheat hitting 9 year lows, this may or may not be a resistance level.

Reports that 80% Ukraine soya and 10% corn are produced from GMO seed; Ukraine forecast to produce 5 mt soya and 26 mt corn.
Increased yields (soya 2.17 t/h) created suspicion as domestic feed demand created opportunities; ‘round up ready’ corn seed available. Inclusion of GMO reported by USDA which has implications as China imports Ukraine grain and bans GMO seed.

Oil continues to firm, brent crude + $49 barrel.

author: Joe Beardshaw

May 18th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up £1.05 yesterday despite sterling making biggest gains for 3 weeks. A reason for firmer UK wheat was the announcement that Ensus was due to re-open in July on a trial basis; lower grain prices help but green energy subsidies will still be required.

Sterling reacted to latest Brexit poll which has 55% remain and 40% leave, a change from April poll of 52% remain and 43% leave, but general opinion has it much closer. Stronger sterling reduces UK export viability, UK undercut by Baltic supplies.

Oil continues to firm, Brent crude fractionally below $50 barrel.

German wheat production for 2016 reduced 2% (1 mmt) from last month as planting survey indicated increase of oilseed area and reduction in wheat.

US markets are being driven by soya, meal demand being the growth engine; soya is pulling up corn and wheat.
Meal stocks in US and South America are 1/3 compared this time last year provoking demand.

US raises steel import tax 522% on specifically Chinese steel, the US are trying to protect from China dumping cheap supplies of cold rolled flat steel (used in manufacturing and construction); this will no doubt lead to counter measures from China.

The US election is causing turmoil for trade, $ likely to have bumpy ride; weaker $ helps $ denominated commodities.

author: Joe Beardshaw

May 16th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat registered small gains (c. £1) last week as agricultural commodities generally found support.

UK March 16 wheat exports were 383,000 tonnes, a monthly increase of 28%; barley exports were 300,000t.
Weaker sterling and export demand has helped reduce UK wheat surplus but further export activity will be required, especially as wheat import tonnage has added to the balance sheet. AHDB estimates 2016 UK wheat crop at 14.5 mmt, down from 16 mmt harvested from 2015 crop.

French wheat stocks reduced 4 mmt (29% down from previous month) as exports, especially North Africa continue. French wheat rated 87% good to very good (91% this time last year).

Russian wheat is benefitting from good growing conditions (62.5 mmt?); if this production becomes reality they will be major exporters, export tax has not curtailed exports from 2015 harvest.

Canada predicted to have smallest wheat crop since 1960’s; how much impact this will have on the world market is yet to be seen, especially with big export producing countries showing good potential crops.

US markets have been supported by soya, big demand (+4.6%) for meal and oil. 66% of soya meal demand for meal will be decisive. Oil helped by tight palm oil supplies. Last week’s USDA report highlighted soya demand, this provided spill over support to corn and soya. High price of soya could see some growers switch from corn to soya. However, corn and wheat stocks remain at very high levels.

Wheat tends to follow corn and US corn is benefitting from exports to Brazil as domestic stocks are tight but supplies may appear as Brazil starts harvest.
French corn 78% planted against 89% this time last year.

Sterling remains nervous as debate on Brexit gets hostile between the ins and outs, both using scare tactics.

Brent crude remains just below $48. Any price increase will see Saudi increase production; although Saudi ‘strategy 2030’ aims to reduce reliance on oil and gas (currently 90% of income). They plan to sell shares in national oil company Aramco and expand economy into petrochemical, mining, construction and tourism.

Budweiser plans to temporally rename its beer as ‘America’ to cash in on current national sentiment.

author: Joe Beardshaw

May 04th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat 16’crop closed £1.20 down yesterday as lack of bullish news. London wasn’t helped by weaker sterling which fell due to economic figures; UK manufacturing contracted in April first monthly decline for 3 years.

Global wheat crops all appear potentially good apart from north China and Poland.

US markets fell, soya had been the market leader providing ‘spill over’ support to wheat and corn but as it fell it took other commodities with it . Rain in US has seen their winter wheat rating climb to 61% good to excellent from previous 59%; corn planting progressing well.

Russian rouble has strengthened making their grain exports less competitive. Russia talking of supplying water to dry areas of north china

Yesterday Oil fell 2% as plentiful stocks weigh on the market.

Funds can influence markets away from the fundamentals; there is extremely high intensity / speculative trading in Chinese markets, for example steel. It has been estimated a steel futures contract in China is held for an average of 4 hours, whereas an oil futures contract in US is held, on average, 40 hours. Even egg trading in China has outperformed the stock market. With this amount of activity is there a danger of a sudden collapse in Chinese markets??

author: Joe Beardshaw

May 03rd

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat registered gains last week (old + £1.45, new crop + £0.65) making May - Nov carry £11.25, European markets were open yesterday but did not do anything dramatic.

Firmer US markets, especially soya; March soya was supported by oil (palm oil firm) but recent rise has been due to meal demand. 2/3rds of Soya is meal, this has helped crush margins which are 14.2% (10 year average 12.8%). U.S corn is c.47% planted and soya c. 9%; could see acre switch to soya? $ weaker on low growth in US helping $ denominated commodities

Bloomberg commodity index (22 commodity components oil, gold, sugar etc) rose 8.1% in April, out performing other investments e.g shares, this indicates fund investment.

French wheat rated 88% excellent down 4% (this time last year 91%) and winter barley 87% excellent (91% last year), these are still very high rating numbers. French corn 27% planted (11% last week) against 68% this time last year

EU wheat exports last week 599,000 tonnes to total 25.0 mmt (-9% last year). Barley total exports 8.7 mmt (+14% last year).

EU 2016 wheat crop increased to 142.76 mmt from 142.38, stocks at 18.87 mmt. International grain council put at 2016 grain production at 2.006 billion tonnes, up 9 mmt.

UK markets quiet with few sellers as growers nervous of crop conditions and hopeful of rises being sustained.

author: Joe Beardshaw

April 28th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Markets are very quiet in terms of movement, London wheat closing unchanged.

US markets also quiet with certain amount of ‘profit taking’. Soya supported by flood damage in Argentina and weak $; Fed Char Yellen has indicated that there is no interest rate rise timetable in place.

US corn planting is ahead of normal (currently 30% against normal 16%) and adequate available moisture. French corn planting is accelerating due to drier conditions.

Sterling fell slightly as UK economic growth slows to 0.4% first quarter from previous 0.6%. Sterling has recently been dominated by Brexit debate; latest phone survey has 45% remain and 38% exit. Eight influential economists have backed exit, they have said - leaving would boost UK economy by 4% in 10 years as removal of EU tariffs would reduce UK prices by 8% helping exports.

Oil was knocked back by US stocks, presently at their highest level since 1929, but also helped by weak $; Brent crude currently $47.25.

author: Joe Beardshaw

April 25th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat finished £2 down on Friday but up overall for the week; £1.40 old crop and £0.55 new crop. May – November spread slightly reduced to £12.05.

US markets fell sharply having seen soya rise $1.80, highest in 7 weeks. The scale of the rise has surprised the market, soya underpinned by meal demand (China?) and possible quality problems with South American quality.

EU wheat crops are all looking potentially good, the only exception is Poland where winter crops lost will be replaced with spring wheat. French wheat area at 80 year high but production is estimated down compared last year’s exceptional yields; French wheat currently rated 91% excellent same as this time last year. Germany wheat put at 26.10 mmt down 1.7% but still above 5 year average.

Russia forecast to have record yields and Ukraine crops improving but wheat area is much reduced.

Whilst wheat is looking good cold wet weather is delaying corn planting; France only 11% planted against 47% last year - drilling is 2 weeks behind normal.

Sterling continues to recover as speculation about Brexit reduced with one poll indicating only 20% possibility of exit vote.

Brent crude remains above $45 barrel.

UK land prices fell 3% first quarter of 2016 due to Brexit fears, low commodity prices and CAP payment delays.

author: Joe Beardshaw

April 20th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up c.50p on the day but trade was quiet; the rise was a reaction to other market activity.

US market surged led by soya (closed +30 cents) which went up due to flood damage in Argentina (5% loss of crop?) and continued Brazilian political issues combined with good meal demand. Wheat markets were also firmer due to nervous shorts reducing positions rather than fundamentals.

Tenders for wheat exports to Asia (50,000 tonne cargoes) due next few days, this could possibly be sourced from the UK but the deciding factors will depend on freight and currency; sterling remaining stable at just over 79p against euro.

Russia has experienced good spring growing conditions; if potential becomes reality, the world’s biggest wheat exporter could see record crop of 62.5 mmt. Ukraine has also had an ideal spring (moderate temperatures and ample moisture) but reduced wheat area could see exports down 33%. Romanian wheat production estimated down 9% to 7.2 mmt. Bulgaria similar to last season at 5 mmt.

Oil rises for first time in 5 days, Brent crude close to $44 barrel currently.
Oil strike in Kuwait (OPEC 4th biggest producer) and slightly weaker $ gave market support

author: Joe Beardshaw

April 11th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat fell 15p on Friday but registered gains of 15p for the week. The May – November spread remains £13.50.

UK markets supported by sterling weakness, UK industrial output down 0.5% in February and thus putting pressure on economic performance. The British Chamber of Commerce predicts UK economic growth has ‘softer feeling’. Weaker sterling will help UK exports but there remains plentiful supplies available in Europe.

French wheat rated best in 5 years (wheat 92% good to excellent, winter barley 91% ). Compared last year, French winter crops are ahead in crop development but spring barley 59% emerged compared to 88% this time last year.

US markets firmer with soya supported by meal prices lifting and more expensive Brazilian soya supplies due to currency. Spring wheat area in the US is down 15% (11.3 m. acres v’s 13.25 m. acres) whilst still concern about moisture deficit in winter wheat areas.

Egypt starting their domestic harvest; the Egyptian government has announced ‘corruption in wheat sector will be tackled’. Domestic prices are at premium to world prices as government try to protect domestic production but buyers look at cheaper available imported supplies.

Oil prices up 6% as stocks reduced and increased expectancy that April 17th talks in Doha will achieve production freeze

author: Joe Beardshaw

April 06th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up 85p on old crop and £1.25 up on new crop; May – November carry now £13.80.
UK markets supported by weaker sterling, currently €1.2453 and $1.4154 against the £. It is felt economic growth will be subdued due to uncertainty regarding Brexit vote and a slowing world economy. Weaker sterling is helping spot demand for wheat, spot prices appear cheap considering forward carries. Also, corn wheat differential is increasing.

No significant weather markets are appearing, although some reports of potential Black sea and eastern European crop losses.
Morocco may need to import 4 mmt wheat, recent dry weather is expected to cut their production by 54% compared to last year; however last year was a record crop.

There is debate about the level of UK spring barley drilled, reports range from 60% - 80% of English crop planted; 75% safe bet? Shorter growing season can impact on yield and quality (higher nitrogen?). Feed barley feels tight, this is leading to questions about supply / demand numbers (more fed on farm?). Lack of French exports to China means UK price rises will be limited, especially with new crop approaching; traditionally UK exports cease from March.

U.S markets saw soya retreat after recent rally; Brazilian real weakens and biodiesel stocks are heavy. Ethanol, a big user of corn, has seen production exceed demand, US ethanol even exported to Brazil.

Mineral oil prices are down, stockpiles increase as Iran ramps up production, this is putting further pressure on the upcoming Doha meeting set for the April 17th and that is aimed at curbing production.

author: Joe Beardshaw

April 04th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up £1.50 on Friday, weekly gain of £1 old crop and £1.25 new crop. May – November carry is £13.50 and May 16 – May 17 £20+.

US markets slightly recovered from Thursdays USDA report, soya reached a 7 month high. Despite bearish planting for corn area, it was reluctant to go down further, prices are already low and corn crop has whole growing season / weather ahead of it.

For the first half of April, Europe is forecast to have above average temperatures, aiding crop development. Regular rain will be required, especially if temperatures warm up; some opinions feel dry April is beneficial for root establishment.

French wheat rated 92% good to excellent (91% last year at this time), winter barley 91% good to excellent (91% last year) and spring barley 98% planted with 85% emerged (70% last year).

IGC estimates world wheat crop 2016-17 at 713 mmt (-3%) but world corn production increased 2.2% (993 mmt). World wheat stocks down 3 mmt to 67 mmt and world corn down 1 mmt to 58 mmt.

Sterling hits 16 month low against euro (80p), latest UK manufacturing output at lowest levels since 2013, economy maybe stalling. Sterling also very susceptible to Brexit situation.

Oil slumped 4% as Saudi states it will only cut production if other major producers follow, especially Iran, who intend to increase production after sanctions lifted; Iran not present at oil meeting in Doha on 17 April. Saudi also intends to reduce reliance on oil income by selling stake in the state oil firm Aramco.

author: Joe Beardshaw

March 29th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up 25p on Thursday to consolidate weekly gains of £1.90 old crop and £1.60 new crop, currently the May 16 – November 16 carry is £13.75 and May 16 – May 17 is £20.95.

This is the time of year when crop conditions are monitored and production estimates are published. The latest from MARS has EU wheat production down 5%, but corn up 11% as last season’s weather boosted wheat but hampered corn. French wheat is 92% good to excellent and winter barley 93% good to excellent.

After the second wettest UK winter since detailed records began, crops are showing big variations in condition, ‘the good, the bad and the ugly’!
Crops have sat in wet conditions and spring drilling is taking place but seed beds are far from ideal; it is too early to predict but yield would appear to be vulnerable.

US markets were open to trade yesterday, wheat saw gains as there continues to be concern about dryness in the plains.
Non-commercials still have a large short position in wheat and will look to reduce exposure; however they have been long in soya and benefitted from rising prices. There is a USDA report this week, this will give a planting survey and may give market direction.

Egypt recently bought 60,000 tonnes of French wheat, French ports are currently very busy but need to shift the surplus.

Dry weather in Ethiopia has led to widespread suffering and hunger; 10 ships carrying 450,000t grain are waiting to unload but poor infrastructure is not helping.

E.U forecast for spring malting barley is 9.29 mmt, this is 400,000t down compared last year (due reduced area) but this would still mean 500,000 tonne surplus. New varieties producing good yields of low nitrogen barley, combined with fertiliser restrictions (e.g Denmark) are creating concerns about too much low nitrogen barley, higher nitrogen barley aids yeast development.

Sterling has marginally firmed from end of last week. Brazilian central bank steps in to slow rise of ‘real’ which had made their exports more expensive helping US trade

Oil remains c. $40 barrel; last week’s terrorist events has made all markets nervous with investors looking for minimal risk markets

author: Joe Beardshaw

March 21st

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Grain markets generally had a quiet week, London wheat was up 10p on Friday, but on the week, old crop wheat was down 45p and new crop down 10p. US markets were also quiet, ignoring current cold weather in the plains; markets wait for USDA report due 31st March this may have a surprise in corn acres planted?

Market direction currently being driven by weather, currency and politics.

Weather has not really featured, European crops coming out of winter dormancy in satisfactory condition and Europe’s wheat crop for 2016 is estimated to be similar to last year.
U.K wheat crop forecast 14.8 – 15.0 mmt down on last year but would still mean exportable surplus; some reports of crop condition and disease levels may affect quality and yield.

Currency remains nervous, although the euro remains c. 1.28 against the pound; the CBI is the latest body to warn of the threat to UK economy from Brexit. $ has weakened helping $ denominated commodities.
Russian rouble has firmed, making their wheat more expensive in world markets, it is estimated they still have 4.9 mmt wheat to export before next harvest; Romanian, French and Ukrainian wheat all undercutting Russian supplies.

Oil down last few days but comfortably $40+, up from previous recent lows of $28; weaker $ helping support values.

author: Joe Beardshaw

March 17th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat was up c. 50p yesterday as sterling fell. Sterling fell to a 2 week low on the back of a budget that gave a gloomy economic forecast. Sterling / euro currently €1.2675, in November it was €1.40+; Brexit continues add pressure.

UK wheat exports have been put at 310,000t, although some Jan exports will appear in Feb numbers. This brings the total wheat so far this season to 1.302 mmt, seasonal barley total 1.036mmt. However seasonal wheat imports are 1.014 mmt and maize 1.157 mmt. Weaker sterling will help export programme.

US wheat markets fell, dryness in the plains has become stale news and the predicted cold weather is not as bad as anticipated. More importantly (possibly), delays in corn planting are due to wet conditions in corn areas, this means later crops will be pollinating during hot period which can have major impact on yields; but still months away!

Egypt bought French, Romanian and Ukrainian wheat at recent tender. Offers were less and prices were higher due to the ergot situation.

Oil recovered losses as US stock pile is less than previously thought, OPEC have announced a meeting for the 17th April the meeting is expected to focus on how to curb production.

author: Joe Beardshaw

March 14th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat was slightly weaker / unchanged Friday but on the week, old crop was +90p and new crop + £1.50, making May – November spread £13.45

Coceral published their crop predictions for 2016:
EU wheat estimated 145.2 mmt (-3.5% year on year), barley 58.9 mmt (-3.6%), corn 63.2 mmt (+8%).
All major producers (France, Germany, UK, Poland) predicting down year on year but Spain up.
UK wheat crop 15.0 mmt (-6.9%), barley 7.1 mmt (-2%), OSR 2.15 mmt (-15%).

French wheat rating reduced by 1% but it is still 93% ‘good to excellent’ and barley is reduced by 2%, 91% ‘good to excellent’.
Ukraine winterkill is not as bad as previously thought in January, however a lot of crops still remain ‘weak’.
Dry weather is forecast for western Europe over the next 7 days helping field work (jet stream shifted north); Spain should have beneficial rain

US markets supported by soybeans are approaching 2016 highs, this is supported by stronger Brazilian currency reducing their exports.
Funds slightly reduced their short position but dry weather in US plains are continuing to make the market nervous.
USDA report on the 21st March will publish stocks and plantings, this has a habit of creating market surprises.

Sterling slightly stronger despite lower UK growth figures; referendum continues to influence.

Oil remains firm with the exports.

author: Joe Beardshaw

March 07th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up (c. £0.50) on Friday to make 2 days of positive movements. Afternoon trade saw values retreat from morning highs and London wheat was down 50p-£1.00 on the week. May – November spread extends to £12.85

US markets were also up, this time supported by soya beans as corruption scandal in Brazil actually supported ‘real’, making Brazilian exports more expensive.
US wheat concerns about dry plains continues to make shorts nervous. In general US commodities appear to be on the rise, oil continuing to firm could increase bioethanol production / demand, copper is a 4 month high, lumber is at a 6 month high, oil 2 month high in US.

2016 world wheat area estimated down 1.4%, low prices curtail production but stocks remain plentiful.

French wheat rated 94% good to very good (91% this time last year) and growth stages ahead of normal due to mild conditions.

Russian grain production forecast 5 mmt down year on year but winterkill estimated 9% against normal 12%. Russian corn record crop? Ukraine wheat production for 2016 estimated down 20% due to dry autumn.

It is reported that 14% French spring barley has been drilled (34% this time last year), only 6% has emerged, progress is hampered due to conditions similar to UK.

El Nino affects southern Africa with drought causing major crop production issues; in northern Africa, Morocco is seeing their harvest potentially cut by 50%.

author: Joe Beardshaw

March 04th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Global wheat markets firmed up yesterday, London closed up £1.25 but fundamentals remain bearish.

Latest UK wheat numbers from Defra suggest domestic usage has reduced and production slightly increased. It has been reported that by the end of March, 2 million tonnes (?) will have been exported, leaving 1.5-2 mmt for end of season exports; although current £12.50 May – November spread is an incentive to hold.

UN predicts 723 mmt wheat crop for 2016 (most other forecasts c. 708 mmt), 2015 crop has been reduced by 3.8 mmt to 733 mmt.

US wheat markets are up partly due to dry warm weather in plains, but more likely short covering, funds are nervous about any bullish news with historic short position.

Some weather / crop reports appearing:
Ukraine wheat down 28% but this maybe ‘worst case scenario’ and weather through to harvest could boost yields.
Morocco, Africa’s number 2 wheat nation, may need to double imports to 4.76 mmt due to drought (benefit French exports).
Indian government projects 93.8 mmt harvest above trade estimates of 82-89 mmt, but imports maybe required.
French and Russian crops look potentially good.

Grain markets helped by weaker $ and Brazilian real surged as president Rouseff is facing possible corruption charges (reducing their exports) .
EU wheat getting cheaper compared to EU corn, this is increasing demand prospects for wheat.

author: Joe Beardshaw

March 02nd

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Wheat markets suffered a day of losses, the overriding bearish sentiment sucked the life out of the markets. Old crop London fell £1.90 and new crop was down £1.65. London set contract lows for March 16, its lowest levels since June 2010 (£99.75).

Market sentiment dominated by heavy stocks and no weather / bearish factors appearing, although there is still time for crop problems to occur.

UK struggling to find new export business, Russia remaining aggressive sellers due to rouble weakness and lack of ice keeping their ports open. Estimated Russian exports from 2015 crop wheat 24.5 mmt (USDA estimate 23.5 mmt) and corn 4.6 mmt (USDA estimate 3.8 mmt).

Sterling slightly firmer for 4th day in row against euro, investors question extent of the decline due to ‘Brexit’; the bookmakers favourite continues to remain the ‘In vote ‘. Euro still has Greek economic problems to face and UK agitation could spread to other members.

US markets also down on bearish factors with soya beans breaking technical resistance levels and corn trading at new crop contract lows.

French corn area for 2016 estimated 6% down due to bigger wheat area.

Oil continues to firm with funds building long position as expectation production reduction (due to price / voluntary agreement) and demand increasing due to economic stimulus

author: Joe Beardshaw
February 25th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Yesterday London wheat fell again as weaker sterling failed to halt the slide.

Sterling fell below $1.40 for first time since May 2009,and with speculation it may fall to $1.35.
Sterling also fell against the euro, currently 1.26 / 79p, although euro also weaker against $ due to Brexit situation.

International monetary fund is ‘positive’ about UK, but there are risks and uncertainties: global growth, sluggish UK production, household debt, Brexit. Carney even hinted interest rate cuts.

UK markets not helped by latest Defra wheat numbers, production increased from 2016 harvest by 273,000 tonnes to 16.444 mmt (largest since 2008. Consumption reduced by 111,000 tonnes to 14.660 mmt due to reduced livestock feed demand. More imported grain into the UK has increased surplus by 415,000 tonnes to 3.964 mmt, up 38% year on year.

US markets are down, led by falling wheat markets due to rain improving US wheat crop prospects. Corn supported by increased ethanol production; mineral oil also firmer.

Russian wheat area is down 3% for 2016 crop, export taxes have curtailed production. Ukraine production is also down, exports from eastern Europe will be reduced 2016 crop.

author: Joe Beardshaw

February 24th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat futures followed other wheat markets down, old crop down £1+ and new crop down c. 75p.

With little bullish news (no weather concerns/ plentiful supplies) values were not helped by lower stock markets and falling oil prices, down 5%.

UK markets will be aided by weaker sterling which continues to suffer due to Brexit situation, some polls put a winning exit vote at 40%.Sterling currently at a 7 year low against $; Goldman Sachs are talking of $1.15 if UK votes to leave EU.

US markets also suffered big losses due to lack of bullish news and slow exports; US wheat closing at 5 year lows.

Ukraine wheat production for 2016 estimated 30% (17.3 mmt) down before any weather problems; production down reduced area and poor crop condition. Unplanted area likely to be spring planted with corn & sunflowers

One commodity firming up is sugar, up 9%; rise attributed to reduced supplies and world deficit, production reduction forecast down in EU.

author: Joe Beardshaw

February 18th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat was down 15p, but on very thin trade.

Demand to the ports coupled with limited farmer selling has seen an increase in physical prices, these prices have not been reflected in futures trading.

Currency has recently been more influential in grain prices and ‘crunch time’ regarding Uk concessions / EU membership, sterling is likely to react. EU reluctant to yield too much ground, fearing it could spread restlessness with other members.

Oil continues to recover up 8%. Venezuela raised its domestic fuel prices for the first time in 20 years, their economy struggles with low oil revenue (premium oil raised from $0.01 to $0.60 litre = 40p).

US markets rise due to stronger oil prices and above normal temperature in southern plains threatening winter wheat; funds are nervous, they are extremely short.

Egypt accepts 0.05 ergot tolerance but rejects Canadian cargo. There has been speculation that the cause of delivery problems is a result of financial shortages. 0% ergot pushed up prices as sellers having to buy expensive insurance against rejection.

Eastern Europe weather continues to conflict with the opinion of crop conditions.

author: Joe Beardshaw

February 16th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed up c. 20p yesterday as it followed other firmer markets. Sterling remains nervous ahead of this weeks ‘crucial’ summit regarding UK membership.

Matif wheat was firmer as Euro was weaker, Draghi alluded to further financial easing. Egypt rejected latest tender with French wheat offered the cheapest.

Stock markets are firmer following market rise in Japan.

Oil continues to rise with Brent crude +1% but Iran loads first oil cargo for Europe since sanctions imposed

On the negative side, funds increase their short position provoked by USDA bearish numbers on world wheat stocks and US wheat condition improving.
Indian wheat crop prospects are better than expected due cooler wet conditions (latest government forecast 94 mmt against trade predictions 75-84mmt), harvest starts March – April

UK exports are busy March & April.
Imports to Spain are forecast to be down but wheat tonnage may increase as wheat discount has increased to corn.

Reports of increased rust disease in UK wheat, conditions and growers are unable to get onto fields because of the wet.

author: Joe Beardshaw

February 12th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed 75p up on the day, market sentiment went from ultra-bearish to short term semi bearish. UK wheat export is revised slightly up to 1 mmt end December (as expected).
Demand to the ports, in the spot position, has seen physical values against futures widen, growers remain reluctant sellers.
On paper, there are plentiful amounts of wheat available but with the May – November carry currently at £12, there is an incentive to hold.

Currency has recently been given market direction. The Euro is currently 1.28 to the £ (1st December 1.42+), this is helping UK in export markets; ‘Brexit’ and poor economic numbers is leading some analysts to predict a fall to 1.20 before recovery. $ is also weaker after Chair J.Yellen of the Fed confirmed no further interest rate rises were imminent, weaker $ supports agricultural commodities.

US markets were helped by weaker $ and firmer oilseed / bean markets as world palm oil stocks reduced.
Funds were buying as they reduced shorts, there were rumours that one major fund wanting to ‘liquidate’ all ag commodity positions.

Markets appeared to have factored in Monday’s bearish USDA report, world wheat stocks increased by 7 mmt to record 238.9 mmt (+ 20 mmt last season).

French markets still nervous after cargo rejects in Egypt due to ergot

Recent rise in oil prices, a ‘false dawn’ according to International energy Agency; they expect stocks to grow by 2 million barrels a day in the first quarter 2016 (demand down, production up)
Currently brent crude c. $30 having hit 13 year low, January $27.67; June 2014 it was $112.

On the fundamental side, disastrous Indian harvests will mean increased imports, there is also concern of winterkill in Ukraine / Russia (spring drought biggest threat to eastern Europe crops); however heavy stocks are insurance against supply threats.

With stock and oil markets continuing to struggle there has been a switch of investment into gold and government bonds, will agricultural commodities have appeal as investment opportunity? Chance of La Nina after El Nino is predicted up, this can impact on grain areas e.g U.S corn belt.

Chinese markets closed as they celebrate new year and year of the monkey starts.

author: Joe Beardshaw
February 11th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London May 16 wheat contract closed up by 50p on yesterday’s trading, Nov 16 up 70p; the May 16 Nov 16 spread is still substantial at £12.

French wheat hit its lowest price in 5 months, however later in the day trading turned the price round to end the day on a gain of 1.8%.

The recent WASDE report continued the bearish sentiment on grains, added to which US ethanol stocks have hit new highs. The US is also experiencing its longest slump of corn exporting, not helped by reports that Russia has banned US corn and soy due to misleading quality certificates.

Suggestions of US rate rises through 2016 give the dollar strength, but weaken the export competitiveness, if and when the dollar weakens it may open up another supply of grain to the world market.

Argentina has benefited from significant rain to end the long spell of dryness.

Brent crude prices are moving sideways, but have come down from a recent rally in over the last 3 weeks, they are back at prices last seen in mid Jan.

author: Joe Beardshaw

January 28th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London closed £1.40 down on old crop and 80p down on new crop, the UK followed weaker European markets. May – November spread now £10.65

European markets were spooked by Russian rumours. Previously markets lifted by talk of Russia increasing grain export duties. Latest rumours are they may remove duties on wheat exports but impose them on barley and corn. Even if Russia exited wheat exports there are enough other eager sellers. The weakness of the rouble makes Russian grain ‘cheap’.

US markets are quiet, wheat down, soya up and corn neutral. The Federal reserve left interest rates unchanged, the US economy is slowing, global equity markets are down and there are inflation concerns. This should weaken $, weaker $ should help agricultural commodities.

South American weather have conflicting reports, Argentina is dry (corn) whilst Brazil (corn and soya) ‘never looked so beautiful’.

Generally, La Nina follows El Nino; if La Nina materialises it could cause hot dry conditions for US corn areas, but it is not certain La Nina will follow.

UK markets are being influenced by sterling, presently slightly weaker as the latest Brexit referendum polls have it split 50-50. Possible exit would damage sterling, but a UK exit could also weaken Europe / euro.

Oil continues to have modest gains.

author: Joe Beardshaw

January 25th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

On Friday, London wheat traded £1 down, 2015 crop down £1.70 on the week and 2016 crop down £2.20 on the week; the May – November carry is now £9. U.K wheat has fallen largely due to currency, sterling firming to 1.32+ (.756p) against the euro.

Currency will be influential in trade when there are so many supplies available.

Since President Macri came to power the Argentinian peso has fallen 40%, combined with reduced export levies, this has meant Argentinean wheat is well placed.

Oil has had a minor recovery, having fallen 18% since start of the year it has now recovered 6%, and is currently c. $32 barrel.

A slowing Chinese economy and a 12 year low oil price makes markets nervous, IMF revising world growth in 2016 down to 3.4% from 3.6% forecast in October.

Ukraine and Russia has been experiencing heavy rain, many areas have had 3 times the seasonal average.

US markets, especially corn, has been showing market resilience as commercial demand supports prices.

author: Joe Beardshaw

January 12th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat lost much of Fridays gains, closing 80p - £1.50 down in various positions. The May - November spread has increased to £9.25.

Markets continue to come under pressure, oil fell to a 12 year low (exceeding the 2008 fall) to trade at $31.41 barrel. Copper reached 6 year lows, however Chinese stocks bounced.

UK export figures for November did not encourage the market. November wheat exports were 138,000t, bringing seasonal total to 656,000t; maize imports were 260,000t to total 816,000t for season. Barley exports were 120,000 to total 620,000t.

USDA report is due today and pre report rumours are for increased US stocks due to slow exports; this may have been factored into the market causing recent falls.

Funds are very short on agricultural commodities and short covering could produce a price spike, especially if USDA is not as bearish as anticipated.

South America continues to be an aggressive seller of corn, soya, and wheat due to weak currency (Brazil / Argentina) and easing of export restrictions (Argentina).

author: Joe Beardshaw
January 05th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

The Chinese new year is on February 8th and it will herald the year of the monkey but 2016 markets started more like the year of the bear with London wheat down £2.0+ yesterday.
Falls in the Chinese stock market spread to financial markets which in turn affected agricultural commodities, US corn and wheat reaching with new contract lows.

With markets at low levels the ongoing weather concerns affecting sentiment should have given some stability but this was trumped by economic turmoil.

There are reports that 25% of Ukraine’s wheat crop has been affected by 3 days of cold temperatures and insufficient snow cover, however warmer temperatures are forecast.

El Niño may change to la Nina which potentially could have increased weather disruption to world crops

Oil prices picked up slightly on increased middle east tension, although an analyst recently predicted oil trading at $20 barrel in 2016.

A glimmer of bullish news is that eastern Europe is experiencing cold conditions and extreme wet conditions in western Europe is not helping crops with growers unable to get on fields to combat disease and pest threats

Plentiful stocks overhang the market, Korea bought south American origin wheat and corn (Egypt bought Argentinean wheat) showing there are aggressive sellers about.

Sterling forecast to weaken whilst European referendum features; interest rate rise maybe postponed. Even if sterling weakens Russian and Ukrainian currency is considerably worse and is helping their exports.

author: Joe Beardshaw

January 04th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

At the end of 2015 London wheat was down 14.5% on the year, Paris wheat -13.3%, European corn -11%, rapeseed was + 6.6%.

Last year saw large volumes of wheat carried over from 2014 into 2015; currently the carry from 2015 into 2016 is comparatively much bigger so there is the likelihood of again a big carryout subject space and financial constraints.

In previous years, when grain markets rally in the new year, it has been due to weather threats; weather is certainly making headlines. The difference to previous years is that stocks are much greater now offering ‘insurance’

NASA has forecast the current El Niño to be as bad as 1998. Excessive rainfall is a feature in many areas (South America, mid west, Europe etc) and France experienced second warmest Christmas day on record.

Cold weather is affecting Russia and Ukraine with temperatures reaching -20C in some areas. Recent snowfall may have arrived in time to prevent winterkill, 10 cm of snow is required to protect against -20C.

2016 Global economy / markets have so far not improved, Chinese share trading halted as 7% falls triggered ‘circuit breakers’.

Oil up on early trading today but Saudi Arabia is maintaining its production and stocks continue to build. The situation between Saudi and Iran could have an impact if tensions increase. OPEC plan to keep up production to try and make U.S shale gas industry struggle to compete. This tactic has not worked so far and US see shale energy as strategically important.

author: Joe Beardshaw

December 30th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat traded slightly up on thin trade yesterday.

Currently London wheat is down 16% on the year, European wheat –14%, European corn -11%, but rapeseed +6%. Wheat globally had its third consecutive bumper harvest increasing surplus stocks; European corn production was down but with plentiful wheat this was ignored. The chance of problem free production for a fourth consecutive year is statistically very low, but even with a problem the surplus will absorb some of the potential increase in price.

Weather around the world is making headlines ; dry north Africa (bullish), wet south America (bearish), wet northern Europe and U.S. Lack of snow cover in Russia / Ukraine is a concern, especially with cold conditions forecast and plants not ‘robust’. Latest crop report from Ukraine 30.8% good (29.8% last week) but this time last year the figure was 40.7%.

U.K exports c. 1 million tonnes by the end of year, this will leave a big surplus to shift; January looks busy but little beyond – reluctant sellers and fewer buyers.

US markets bounced on weather influence but with funds very short any major threat could see ‘panic buying’; although funds have switched out of agricultural commodities.

U.K is struggling to compete in export markets; French wheat ignored in favour of South American wheat in recent Egyptian tender; Egypt state they have enough wheat until May.

Some analysts are predicting a weaker sterling due to uncertainty of EU vote; currently £ / $ is 1.48 with forecast of a decline to $1.41.

Oil recovered slightly yesterday but oil in March 2012 was $125 barrel now $38 barrel. Saudi Arabia has $98billion budget deficit due to oil price fall (77% revenue from oil)

author: Joe Beardshaw
December 24th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Not surprisingly the markets are very quiet, London 15 crop unchanged but November 16 up 40p; the spread between May 16 and Nov 16 is currently £7.95.

London supported by weaker sterling (1.36 against euro) on the back of disappointing economic numbers.

For the first time in 3 years Egypt bought Argentinean wheat in latest tender, undercutting French wheat by $10. This may be due to the change of government in Argentina, removing export restrictions and also a weaker currency; Ukraine supplies did not feature in the tender and appear to be tightening.

MARS, the European crop bureau, stated European crops could be vulnerable to a cold snap, recent mild conditions have not made them frost tolerant; no cold weather forecast.

Cofco, the Chinese state owned agricultural trader has increased its global profile by buying Nobel agriculture; they are active in 29 countries, employ 9,500 and have annual sales of $14.9 billion.

Oil recovers slightly and OPEC predicts $70 barrel by 2020 href="http://www.bbc.co.uk/news/world-middle-east-35166467" class="nlink">

author: Joe Beardshaw

December 22nd

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Wheat markets continue to track sideways, with small losses on London wheat yesterday negating last week's gains.

Markets will be influenced by weather, currency, politics but fundamentals of supply greater than demand overhangs market and limits rises. Funds have been buying but more due to profit taking / book squaring before Christmas break.

Sterling fell against euro partly due to Spanish election result, Argentinean peso devalued 25% making their exports more competitive.

EU wheat area for 2016 largely unchanged although France will increase slightly
Despite this spread between May 16 and Nov 16, currently £7.55, some analysts think this may increase; Wheat price £120 at 4% interest per annum = less than 50p month carry.

Russia has a habit of surprises on 25 December (they celebrate Christmas in January) e.g invaded Afghanistan on 25 Dec and Gorbachev resigned 25 Dec. Rumours are they may scrap export tax to sell surplus wheat due to weaker rouble (oil price related) and possibly indicating confidence in 2016 crop potential

Russian / Ukraine crop condition makes them vulnerable but the damage will not be apparent until spring.
At present weather is not having an impact, although it is dry in South America, especially Brazil, which will help soya prices.

Oil continues to fall, brent crude is the lowest since 2004. Heavy supplies weigh on the market, producers continue to swell stocks but with current price below expectations how much further is the downside?

Bee populations in some US states are down 23%, this has been attributed to increased biofuel production i.e corn. Bee pollination is vital to US crops, estimated to be worth $3 billion and could affect crop production.

The World Trade Organisation reached an agreement to reduce agricultural subsidies aimed to help poorer nations compete.

author: Joe Beardshaw
December 11th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat fell 60p yesterday having been up £1 on Wednesday. Sterling firmed marginally against the euro despite Bank of England voting 8 – 1 to keep interest rates on hold.

Wednesdays USDA report has been perceived as mildly bearish, it highlighted plentiful global supplies and stocks.

E.U stocks put at 8 year high, French wheat double the ‘normal’ as exports are not keeping up with supply. Reports are that autumn plantings in France (wheat and barley) may increase at the expense of spring drillings.

Whilst reports have focused on supply, demand has not been highlighted, this may be reduced due a mild autumn (feed demand, bird flu) and biofuel down (Abengoa).

Attention will switch to northern hemisphere wheat harvest and any crop scares (Ukraine, Russia) but stocks give some insurance.

US markets were firmer on corn and wheat despite nothing fundamentally changing. Corn, soya and wheat are near 5 year lows and appear reluctant to break lower, does this mean the lows are established? Funds are very short, there may be short covering and position reducing before the Christmas break.

Oil prices continue to struggle, despite US stocks reducing for tax reasons rather than increased demand.

author: Joe Beardshaw
December 08th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London was up nearly £1 yesterday but it has been within this range for the last few months. European wheat and corn markets have also been tracking sideways, but the fundamentals of plentiful wheat supplies overhang the market.

UK supply / demand has not been helped by continued mild weather, reducing domestic demand for livestock feed.

U.S markets lost some of the recent gains due to stronger $ and reduced crop concerns due to rain in Midwest & Plains. Funds have increased their short position in wheat, USDA report due Wednesday.

83% of the Ukraine winter plantings has emerged, 1.1 m. hectares still to emerge; of the emerged crops 66% rated good / satisfactory, meaning 1.9 m. hectares weak / thin. Russian crops helped by recent moisture.

Oil prices fell to lowest levels since 2009 after OPEC decided not reduce production. Saudi Arabia has a budget deficit and dwindling foreign currency reserves but it is maintaining a policy of maximising market share. Their strategy of keeping oil cheap will delay further shale gas developments. Fall in oil prices has seen Russian rouble fall, making Russian wheat cheaper.

Thursday will see a new government takes office in Argentina; there are rumours of cutting soya export tax from 35% to 30%; less than expected, keeping Argentinean soya expensive.

author: Joe Beardshaw

November 23rd

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat was down 50p on Friday to total a weekly decline of 20p. Sterling is near an 8 year high against euro, this is making exports difficult, especially with aggressive sellers elsewhere. Strong sterling not only hits exports, it increases imports, especially ‘quality’ wheats. European corn markets were up 1 euro on the week.

AHDB forecast for 2016 U.K crop area has wheat unchanged; winter barley down 4% and spring barley up 10%. Any reduction in yield will be compensated by weighty carry outs after two consecutive 16+ million tonne crops.

IGC has 2015 world wheat crop at 726 mmt but reduced carryout by 1 mmt to 208 mmt, however this is still up on last season’s 201 mmt.

EU granted export licenses for 636,000 tonnes of wheat last week, up 58% from previous week and largest weekly total of the season. Export pace is behind required rate to shift surplus and significantly less than this time last year.

Ukraine likely to limit exports to 16.6 mmt wheat this season (so far they have shipped 8.4 mmt).
Macri wins Argentinean election with pre-election promise to lift export restrictions.

Allegedly 60,000t barley boat loading in U.K in the next few weeks, but the expected surge in export demand for barley is hampered by currency and China reducing import requirement. Variable quality of Australian malting barley may increase feed supplies but reduce malting.

Based on the fundamentals of supply and demand, the current sentiment on wheat markets is bearish. For there to be a change in sentiment, some crop threat needs to emerge to add ‘momentum’, a Bloomberg survey of traders had 5 bulls, 9 bears, 9 neutral.

author: Joe Beardshaw
November 17th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat traded down 30p on 2015 crop and down 55p on 2016 crop.

Port and consumer shorts coupled with meagre farm sellers have supported UK domestic prices. Low water in the Rhine and questions over Black sea supplies has pushed up expected U.K wheat exports to 1 mmt by Christmas but there is a substantial tonnage of imports to shift.

U.S markets were quiet yesterday, registering a very low volume of trade with wheat slightly weaker. Mexico bought 1.44 mmt of corn (old and new) and commercial interest indicates current low prices are provoking demand. Maybe it is case of ‘best cure for low prices is low prices’.

With funds short any global supply issues will have increased impact.

U.S. $ has nearly reached a 12 year high against basket of currencies, European events and expectation of a rise in U.S. interest rates saw U.S investment, however the strong $ has negative influence on $ denominated commodities.

author: Joe Beardshaw
November 13th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Wheat trade is very quiet, few buyers matched by few sellers; London wheat was 10p down on the Thursday.

Whilst other commodities such as metals and oil had a down day agricultural commodities did well to hold their ground. Continued concern about Chinese growth has been the reason for commodity falls.

Egypt bought equal amounts of Russian and French wheat at the latest tender.

Wheat stocks and supplies are well documented, attention may switch to corn which will become the market leader.

U.S Wheat recovered some of the USDA inspired losses, the trade felt the fall may have been overdone. Funds that are short are nervously monitoring Australian harvest (rain delayed eastern harvest) and crop development in eastern Europe.

Corn continues to come under pressure but how much further is the downside in U.S? World corn stocks are not as weighty as wheat and over 50% of world stocks are located in China. The Chinese corn inventories are forecasted to fall for first time in 6 years.

Liz Truss is due to sign an agreement this week with China that will mean the U.K will become an ‘approved’ supplier of barley to China, possibly provoking export business post-Christmas.

author: Joe Beardshaw

November 10th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat traded 50p down yesterday as bearish factors outweighed any bullish sentiment.

U.K exports continue to struggle with the estimated 900,000 tonnes by end of December, failing to put a dent in the exportable surplus, especially when wheat and corn imports are considered.
Despite better quality and a big crop, French exports to the end of September are down year on year (3.81 mmt v’s 3.94 mmt); better quality has helped north Africa exports but the big fall attributed to reduced Spanish business.

To add to the bearish woes, US wheat markets took a big hit yesterday down c. 20 cents, wheat hit resistance at $5.30.
USDA report due today, this may fuel the bearish argument of plentiful supplies and reduced demand (low export numbers).

Support for the wheat market had been coming from crop conditions in eastern Europe and the threat of El Niño, whilst these could be very bullish factors they are not yet a reality, the hefty supplies and low demand are fact, these are factored in with the carries forward.

author: Joe Beardshaw
November 09th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat had a quiet trading day on Friday and closed the week at only a few pence different to the start of the week. Currency was an influence last week with £ / euro reaching 1.42 before retreating to 1.40 as expectation of interest rate rise receded.

$ was stronger on jobs data (jobs created 271,000 higher than expected) and expectation of interest rate rise = stronger $, weaker $ denominated commodities. Euro weaker helping exports but behind the pace required to shift surplus.

UK customs data actually had U.K importing more wheat than exported to the end of December (314,000 exported , 432,000 imported); exports have improved since September but after two 16 million tonne crops supplies are plentiful especially with the biofuel plants shuts down / reduced usage and a mild autumn reducing the demand for animal feed.
Prices supported by lack of farmer selling but this could mean problems long term when they do sell, unless exports dramatically improve.

USDA report tomorrow - World Agricultural Supply and Demand Estimates.

Market shorts are kept nervous by crop condition in eastern Europe with rumours Ukraine may try and curb exports. Ukraine wheat area could be down 19% meaning production down 30% and much reduced export availability, however in contrast, French wheat rated 97% good to very good.

China continues to struggle with exports and imports are down; China has been the economic engine for global growth.

Lack of rainfall in India has seen domestic prices firm, added to which hoarding takes place as consumers try to secure supplies.

author: Joe Beardshaw
November 06th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Yesterday London wheat closed up c. 50p, this was largely attributed to currency, sterling fell against the euro.

Bank of England monetary committee voted 8-1 to maintain interest rates the same; a level unchanged for the last 6.5 years. Interest rate rise has been delayed as the inflation risk has reduced due to slower global growth.

U.S markets were weaker, apart from wheat which defied gravity, it has remaining unchanged despite rain in the grain belt improving prospects.
Corn fell due to plentiful supplies and soya is down on poor export numbers, but remains significantly cheaper than south American origin. USDA report is due next Tuesday.

U.K exports remain sluggish although rumours of 25000t vessel sales persist; however 1 mm tonnes by Christmas remains optimistic. Growers remain reluctant sellers, this is lending some support although November is traditionally a selling month, meaning more physical wheat to move.

U.N food committee said food prices rose 3.9% October biggest monthly rise since Feb 2012, this was due to sugar + 6.2% and palm oil + 17.2% with cereals up 1.7%.

author: Joe Beardshaw
November 02nd

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed 50p down on Friday but slightly firmer on the week.

US wheat markets up possibly as funds buy to reduce short position but technical analysts feel upside unless wheat breaks $5.30 which would indicate trend change. U.S soya beans now cheapest supply, if China buys they will be sourced from U.S.

Sterling gains against euro and expectation for euro to remain weak, this should help European wheat values; European price rises will influence U.K. However exports from E.U are lagging despite Egypt last week buying European wheat; worryingly, last week E.U corn imports were bigger than combined wheat and barley exports.

Latest IGC figures have global wheat area for 2016 down 1.2 million hectares but the total still above 5 year average. Production could be further decrease as area has slightly reduced but growers have cut inputs to save cost and this is resulting in lower yields.

El Niño impact being blamed for southern hemisphere crop concerns, Argentinean wheat crop has been put at 9.5 mmt; -16% year on year. Heat and moisture stress in Australia, especially New South Wales (30% wheat production), and hail and frost hitting western Australia.

Chinese manufacturing down for third month in a row, hitting far east stock markets.

U.S employment numbers will be published today this could impact $ and therefore affecting commodity markets.

author: Joe Beardshaw
October 27th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

May London wheat closed up £1.80 yesterday as London reluctantly followed firmer U.S and European markets.

U.S wheat markets unexpectedly rose due to weather concerns making shorts nervous; funds are at shortest position on wheat since May 2014. U.S plains did not receive the expected rain, dry conditions persist.

Dry and cold weather is forecast for the Ukraine and Russia over the next two weeks, this will threaten poorly established plants; eastern Europe is generally experiencing dry conditions.

Russian winter plantings is 90% + complete but Ukraine is behind planting; revised winter area 5.8 m hectares against 6.7 m hectares (2015 crop).
2015 Ukraine wheat crop was 24.2 mmt; reduced area could see this fall to 19 mmt, although unplanted areas could be replaced with spring crops e.g corn.

E.U markets helped by weaker Euro and further Chinese rate cuts have led investors to look to the $ and £.

Iran, a big wheat exporter, announced it will sell 400,000 tonnes as increased domestic buying has swelled stocks.

Oil prices remain under pressure.

author: Joe Beardshaw

October 14th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

November London wheat closed 50p higher yesterday helped by weaker sterling (low inflation figures). Export / fob prices improved with bids parity / small premium to futures, previously exports/fob were a significant discount.

Sentiment appears to have shifted to a general buy commodity attitude. International buyers (Egypt, Algeria, Saudi) have been recently purchasing, looking to stock up as wheat prices are 14% lower than the turn of year. Part of this buying impetus is due to Russian crop concerns for 2016 crop, there has been 40% less rainfall than normal and Russian wheat prices are also higher, partly due to stronger rouble.

Australian wheat crops reduced due to dry conditions and threat of El Nino continues to make headlines.

The U.K has produced two 16 mmt wheat crops, plus carry in that has been estimated at 3.5 mmt available surplus for exports (522,000 2 seasons ago) so exports need to accelerate (especially with biofuel plants closed but expected to start again by 2017 as E.U changes biofuel regime)
Last time there was 3.52 mmt surplus in 2008/9 futures fell to £87.50 but this was in different circumstances

USDA reduced Ukraine corn crop to 25 mmt with 17 mmt exports (-14% year on year), this still fells optimistic with talk of a 20 mmt crop; France has also downgraded corn crop.

US markets are up; corn dragged up by beans and wheat as commercial buying and possible Chinese bean exports fuel the rise.

UK markets are short term supported by limited farmer selling and short covering. If selling accelerates, demand would struggle to absorb it, however conflict between 2015 surplus and 2016 crop concerns will determine whether demand will increase.

author: Joe Beardshaw
September 24th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions

London wheat was an impressive £3.85 up in the November 15 position, having gained 40p on Tuesday, but why?

European markets were provoked by firmer US wheat markets that closed over $5.
Commerzbank said the USDA 2015 – 16 wheat harvest figure of 731 mmt was optimistic and expected wheat to trade $5.20 in next few months.

The rise is largely due to weather with continued dryness in Russia and Ukraine with no rain forecast
However plantings in Russia similar progress as last year at this stage and they have had satisfactory 2015 despite continued growing /crop concerns during growing season

El Niño impact on Australian crops (dryness) continues to make headlines.

Fundamentally there are abundant supplies of wheat, world stocks of 226 mmt are up 7% on last year at record levels.

Markets have always been vulnerable to fund influence and with funds short combined with perceived weather threats could see significant buying.
Wheat has come down a long way and funds look at this with production concerns and feel investment opportunity as the upside is greater than downside.

Russia and Ukraine setting brisk export pace as Russia expects record exports in September; supplies swelled by old crop carryover.

Spanish exports in July up 5% year on year with significantly barley +75%.

Poor factory exports in UK could delay interest rate rise = sterling weaker?

author: Joe Beardshaw
September 17th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions
London Nov 15 wheat gained £1.60 on Monday but has now lost these gains in the last two days, abundant wheat supplies and little buying weighs on the market.
Markets supported by a lack of physical sellers and a £7.75 carry between Nov 15 and May 16, this is making trade sellers nervous; currently Nov 16 is trading at £13.65 above Nov 15.

Russia is on course to export 4.5 mmt of grain this month, a majority of this is wheat, nearly 1 mmt grain were exported in the first 9 days of September. There are also rumours of exports taxes being relaxed.

Following on from reduced French corn, Spain is the latest country to announce 10% reduction in corn production; however this news is having little effect on markets due to the glut of wheat and alternative corn supplies.

El Niño is predicted to peak at the end of year, but so far there is limited impact on grain, Australia is talking of 17 mmt wheat exports, this is close to the average.
Bullish news of freezing temperatures in Brazil and wet conditions in Argentina have posed threat to wheat crops.

Russia has experienced 33% below average rainfall in wheat areas and the two week forecast is dry, this is threatening plant growth / establishment; planting schedule is already behind. Ukraine also experienced drilling problems, only 61% intended osr area drilled and planting window is now closed.

The US federal bank will today announce whether interest rates will rise for first time since Dec 2008, their decision will be largely based on whether they feel the economy is strong enough. Stronger $ would affect $ denominated commodities and could put pressure on developing countries economic growth and financial stability, some Chinese analyst have come out and said that last month’s collapse was due to speculation of US interest rate rises.

U.S markets were confused early yesterday when the Farm Service agency published planting figures, they issued figures for 2014 rather than current 2015 crop areas.

author: Joe Beardshaw
September 14th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

November London wheat was unchanged at the close on Friday but £1 up on the week, corn was up €3.50 on the week. There is plenty of wheat but reduced supplies of corn.

Friday’s USDA report was bullish to corn, domestic stocks were cut 125 m bushels and yield cut 1.3 b/acre, however this is still a hefty 167.5; corn stocks to use 11.6% considered comfortable. Whilst these reductions were expected, they were higher than many forecasts and lifted corn values with spill over support for wheat.

European wheat production increased 6.3 mmt from previous report but corn reduced 4.25 mmt; domestic demand up 1 mmt for wheat.

Despite weaker sterling, the U.K is struggling to compete in export markets; Black sea supplies and even aggressive Danish offers are more competitive. End of September barley exports may exceed wheat exports as small boat demand for barley continues.

Over the next two years, El Nino is predicted to raise global temperatures, as seen in 1998. However Australia, one of the first countries to be effected by El Nino, has seen rain during the winter, despite a forecasted El Nino-driven drought, and the result is a larger barley crop. The north pacific ‘PDO’ is also entering a warm phase combined with increased greenhouse gasses, potential warming effect, but Europe is predicted cooler summers!

China’s stock markets are down due to slowing economic growth.
German finance minister, Wolfgang Schaeuber, warns of a potential financial bubble, caused by QE leading to global problems unless economic reform is incorporated.

author:Joe Beardshaw
September 11th

Market Report

Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Yesterday London wheat closed unchanged, there is speculation of whether the bottom of the market has been seen at £110 November futures (currently £112); a range of influences (currency/ exports, southern hemisphere weather, Russian exports, corn crop etc) make a firm prediction difficult.

HGCA latest estimates have wheat harvest 70% complete but yields have increased to 8.5-8.7 t/h from previous 8.3-8.6 t/h, this would mean 16 mmt crop; Scotland only 10% cut.

French wheat crop estimated as high as 40.7 mmt and exports are struggling but Egypt has raised its moisture spec from 13 to 13.5% until end of May 16, this should help chances of export.

French corn crop is down 25.7% compared to last year but last year was a record crop!

USDA report is due out today; September report has a reputation of being a low key report. It is expected that U.S yield will be cut and a reduction in corn and soya stocks but this was suggested last report. If corn stocks are cut it could see stocks to use ratio at 12% = Bullish

Global food prices have fallen at their fastest rate for 7 years (last month -5.2%) largely due to market glut, embargoes (Russia & china) and demand reduction (economic slowdown).
FAO raised world wheat crop to 728 mmt (+ 5mmt) and stocks a 13 year high at 202 mmt.

Despite rumours of interest rate hike, US wheat and corn firmer as $ weaker, there have been no new highs in last 6 months.
European GDP and falling unemployment could see euro firmer; sterling uncertain.

author Joe Beardshaw

August 20th


Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Yesterday London November wheat closed up £0.65, this was in contrast to lower European values. The trend has been declining prices, London wheat down 13% in July, Paris wheat -12% and Paris corn –7%.

Falls in wheat prices prompted by heavy yields and increased carryover. French yields are up 8% on last year and production put at 40+ mmt, hot weather has helped rather than hindered crops. German yields are down by 11% however this has been cancelled out by carryover stocks that are up 30%.

U.K wheat quality should increase domestic consumption and reduce imports but flour millers are noted for their absence from the market.

Russian wheat harvest is 50% complete, yields are down 9.2% (3.23 t/h), this is likely to reduce even further as harvest advances north but grain production still estimated 100+ mmt.

US markets are down, especially soya beans, as rain helps pod fill. Markets are still digesting USDA numbers, for example increased yields in Indiana corn were at 142.94 bushels / acre; USDA 158 b/a. Recent areas of ‘preventative’ plantings (areas not drilled) are higher than expected, this figure will need correcting in future USDA reports.

Oil prices remain depressed but some analysts expect a price bounce to $70 barrel, currently Brent crude c. $47.

The Euro remains €1.40 to the £, Barclays predicting €1.47; U.K interest rate rise is still in debate. Differential between U.K and French wheat increases.

Greek agreements adds some economic stability but concerns remain about Chinese demand which has been the ‘commodity engine’.

Russia destroys food in retaliation against European sanctions and arrests 6 people for smuggling European cheese into Russia.

author: Joe Beardshaw

August 12th


Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat shed all recent gains closing down £2.60 yesterday; European wheat down €4.50 and European maize down €3.0, the fall was triggered largely by economics and the burden of new crop supplies.

Yield reports have caused a revision to U.K wheat production, +16mmt crop anticipated; previous expectation 15.2-15.4mmt, this is compounded by the big 2014 crop which left a 2.0 mmt carryout after net exports (after imports) totalled 270,000t. At the current price and sterling levels the U.K wheat can compete with French and Danish supplies, but the problem is a lack of buyers.

Global markets were rocked by China again cutting the value of the yuan for second day, this also dragged down other currencies (Australia, Malaysia) and could trigger a currency war. China reduced yuan to try and stimulate exports / economy.

USDA report is due today, markets are uncertain / nervous of content as the report will include field data for first time, recent cool conditions are beneficial to corn development.

French corn production has been put at a 9 year low, added to which some of the corn is being cut for silage due to poor grass growth. Imports could potentially come from Ukraine but they are suffering from heat.

author: Joe Beardshaw

August 07th


Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

November London wheat closed up yesterday £1 and November '16 was up £1.65 (£10.95 differential Nov 15 against Nov 16).

European maize was + 3 Euros with front month maize a premium to wheat for first time in 2 years.

Latest EU export figures wheat 372,000t (seasonal total 2.0 mmt), barley 384,000t (total 1.8 mmt) but maize imports 632,000 (total 1.4 mmt).

Latest Russian yield figures reduced to 3.16 t/h, down 4.8% against last year but still expectation of hefty wheat crop.

US wheat markets up above $5 level as commercial buying supported wheat markets, soya and corn down. Tension building ahead of next week’s USDA report.

ADAS winter barley yields put at 1.1 – 7.3 t/h, but these big numbers are based on southern yields; later yields are likely to reduce.

Cargill announce for the March – May period, their first loss for 14 years; the loss was attributed to ‘technology’ and losses in Venezuela where the ‘bolivar’ has devalued by 90%.

Super Tuesday proved to be an anti-climax, only one member of the Bank of England committee voted for an interest rate rise, the result, a slightly weaker sterling.

author: Joe Beardshaw

August 06th


Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

London wheat closed unchanged.

Wheat yields are exceeding expectations on the first cuts of UK crop.

French wheat harvest forecasts have been put as high as 39.4 mmt smashing the previous record harvest of 38.2 mmt in 1998; increase attributed to increased area and big yields.

Despite increased cheaper offers from France, Egypt again bought Russian wheat. Black sea supplies dominate export markets but due to volumes of sales there could be logistical problems of physically loading and shipping.

Wheat crop is here but concern is appearing over maize crop, European maize was up 3+ euros. French maize has been described as the worst since 2003 with crops half height and heat causing pollination problems; June survey has 85% French maize good to excellent, recent survey 59%. French yields could be down 24% and EU crop down 19% compared to record 2014 crop; biggest reduction since 2001.

Adding to sentiment, swarms of locusts are eating southern Russian corn crop. Global stocks offer some consolation but south American corn could increase volumes into Europe.

US markets are firmer on demand for soya and wheat, record exports of ddg’s to China indicate continued demand for protein which should support corn markets. Markets likely to be quiet before next week’s USDA report the first analysis of production / supply.

Differential between November 2015 and November 2016 reaches £10, this is provoking talk of increased carry out before harvest even gets into full swing!

Today is Super Thursday, Bank of England will publish interest rate discussion minutes and latest inflation figures, sterling remains above 1.43.

author: Joe Beardshaw

December 31st


Our market reports are opinion based and are not instructions to trade. You are responsible for your own trading decisions.

Wheat values have continued to decline as there is little bullish news to support values.

New crop wheat has fallen c. £7 in the last 10 days as indicated by nov 13 futures. The fall in old crop has been even more dramatic with little buying interest.

The bearish sentiment has been fuelled beneficial weather to crop potential.
The U.S corn crop is now 95% planted and the moisture that was previously a problem could now be a benefit.

World grain stocks are predicted to increase significantly as a result of the 2013 world corn crop.

USDA report issued tonight could give market direction.
The cereals event taking place in U.K today and tomorrow often has an impact on market trends. A concentration of growers and trade looking at market fundamentals could lead to increased selling.

The Ukraine harvest is due to start in the next few days and if yields are favourable offers of relatively cheap grain may increase.

With current values still £15 more than this time last year and production looking favourable you would feel there is more downside than upside in current circumstances.

The French market keeps testing the psychological 200 euros (matif nov) and if this gets broken further falls are likely.

Feed barley has followed feed wheat down and remains at a hefty discount. Despite the fall in prices U.K barley is finding little buying interest.

To get some demand going some ‘big boat’ business needs to happen.

Malting barley prices have fallen but not to the same extent as feed grains, this has meant premiums have actually increased. With tight European stocks markets are supported until tonnage is actually in the barn. Despite relatively good prices growers are reluctant sellers.

East Anglia is the centre of good demand for spring barley and if the market is starved of sellers a ‘short’ market may develop.

Winter malting barley trade is neglected with minimal buyers, quality will be the important.

Market still being led by prospects of a big soybean crop in US and Brazil increasing global 13/14 production 18%. US stock must be running very tight now as the year’s export figures have already

passed USDA’s estimate, which is evidently reflected in old crop soybean futures price. Fairer weather in the US has allowed for soybean planting to catch up, although 71% planted vs 5yr avg 84%. Commentators/analysts are forecasting that due to delays in corn plantings (95% complete) as much as 3M acres will be switched to soybeans – question is will the weather allow for US growers to complete planting campaign. Today’s US weather reports show a severe weather warning over the Midwest (hail, tornados and thunderstorms) which is likely to have an impact. The market will surely remain volatile until there is more surety over planting figures.

Rapeseed estimates are for EU production figure to increase to 19.72MMT up from 19.31MMT last year as large German crops and eastern EU will offset poorer crops in France and UK. Large crops expected from Poland, Czech Republic, Denmark, Romania, Hungary and Slovakia.

The current OSR picture feels bearish; although tonight’s USDA report will be crucial to the trend of the market as any surprises to the stock figures will undoubtedly get an aggressive reaction.

We are currently allocating harvest storage space to a range of stores. If you would like to reserve space (on a priced or price to be agreed basis) please contact the office. We can guarantee efficient harvest movement and are able to handle seasonal quality variables.

author: Andrew Dewing