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