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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