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Thursday 24 June 2021
- After a topsy-turvy week US wheat prices remain virtually unchanged, while corn values are down $15/t following the liquidation of corn/wheat spreads and talk of a higher US corn acreage.
- US spring and summer crops ratings (wheat, corn and soybeans) continue to decline amid the drought-like conditions in the western corn belt and northern plains.
- Dry conditions are seen affecting much of Canada’s agricultural areas, and timely rains are much needed if crops are reach expected yields.
- Ukraine has started its 2021 winter wheat harvest soon after the ministry confirmed spring sowings were complete. However recent heavy rainfall has raised concerns over final quality and quantity of this year’s winter wheat crop.
- By contrast, an estimated 81% of France’s soft wheat crop was in good/excellent condition as of 14 June, unchanged on the week but well above the 56% figure recorded the same time last year.
- EU crop monitoring unit MARS reports 2021 cereal yields are set to be ‘firmly above’ average yields this season, and has raised its soft wheat projection to 6.01t/ha. That’s an increase of 0.1t/ha on last month’s figure and well above the five-year average of 5.69t/ha.
- This, plus the ongoing prospect of French wheat going to China and competitive prices for German/Baltic supplies should yield brisk EU wheat demand at the start of the 2021/22 marketing season, while an export levy clouds Russian prospects.
- Current favourable weather continues to boost prospects for UK crops. ADM puts wheat production at 15.2-15.5mln t, while stressing that the crop is far from made. As wheat enters the key grain filling stage, weather becomes more crucial to final production.
- Despite the likelihood of a slightly larger 2020/21 carry-out and a sizeable 2021 wheat crop, the UK is still expected to be a net importer this coming season, although not to the scale projected a few months ago.
- But, with global wheat stocks seen as more than abundant, ADM believes new crop prices are reasonably attractive for farmers, especially given better yield prospects.
- Some long-term support could still surface from the global corn market and further Chinese commodity buying, while summer weather in the US and the USDA acreage report due out next Wednesday remain key market-direction signals for all major grain and oilseed commodities.
- The recent rains have benefited the spring barley at grain filling stage and both the UK and EU malting barley crop prospects continue to look very good.
- New crop prices remain static with some consumer interest this week.
- We have a variety of new crop contracts available. Please speak to your local farm trader for details.
- The sentiment hasn’t really changed much over the last week and barley markets are drifting sideways, as we still see little engagement from the farmer.
- UK consumers have been quiet for another week, still waiting for harvest and hoping for better prices.
- We have seen some interest from Spain in the last few days, but in general the country has had a good growing season and should not need to import much. Similarly, in our other nearby destinations (NL/Ireland), demand is nowhere to be seen at current UK replacement levels.
- In general, the tightening nature of the balance sheet in northern Europe is stimulating demand rationing, and barley is currently uncompetitive against wheat and corn, so there is no inclination from buyers to jump to buy current UK values.
- When the farmer comes to the table at harvest, with the current situation we still expect to see harvest pressure in order to find the necessary demand.
- CBOT soybeans have had a very choppy week.
- There seems to now be adequate moisture in the forecast, which has started to ease the drought concerns in the eastern belt.
- US soybean plantings are now reported to be 97% complete, 3% up on last week and just ahead of this time last year.
- During the early part of the week, China became more active regarding imports. That, combined with the weaker US dollar and higher crude oil prices, helped to add support to the market.
- Malaysian palm oil firmed overnight on Tuesday following the pick-up in the soy-oil market.
- For the second week running, USDA has dropped its US soybean crop ratings, down from 62% good/excellent to 60%, which is 10 points lower year on year.
- Matif has firmed over the week, with August 21 now trading at €503.50 compared to last Thursday’s €490.50.
- UK rapeseed crops continue to look well, but farm sales have come to an almost complete stop, with growers now waiting to see what comes into the sheds before making any more sales.
- As we reach the end of the old crop season, we are still managing to place odd loads which farmers bring forward as they clear their stores. With a large inverse into new crop there is no reason for anyone to carry any old crop seed into new crop.
- Old crop markets are few and far between, with very little interest into either the milling or feed sector, as buyers are reported to be covered until new crop.
- The weather over the last week continues to support ideas of a good oat crop. However the weather over the next six weeks is crucial for determining overall quality. The UK millers are happy to largely remain absent from the new crop market until they get a greater understanding of harvest 2021 grain quality. They are well covered with existing futures-related contracts and hope to pick up cheap oats at harvest, with farmers needing to manage much larger wheat and barley crops than last year.
- Export bids for 2021 into Europe remain below recent previous domestic feed prices, largely driven by freight rates which are 50% up on last year. However, despite this, we are not far away from calculating.
- Pulse markets have been very quiet on the week, with little farmer selling or consumer interest on both old or new crop.
- Old crop bean markets remain firm with few supplies coming forward from farm, despite a number of large parcels left unsold. The old/new crop inverse has widened by another £3-5/t this week, so any growers with old crop beans left on farm should look to market these before new crop is available.
- New crop bean prices have drifted lower on the week in line with wheat futures. Despite the lower numbers, consumers remain absent from the market with many confident they will be able to buy at cheaper levels in the months to come.
- Bean and pea crops are generally looking very well and the expectation is that they will yield significantly better than last year. With temperatures remaining warm this month during bean flowering and pod set, it is likely insect damage levels will be high in the UK once again.
- Marrowfat pea buybacks are available for harvest 2022 at historically high levels. Please contact your farm trader for further information.
- Winter wheat: seed availability is currently looking across the board. View our latest seed YouTube video for an insight into the current Group 1 milling wheats.
- If you are looking for an early-drilled wheat after OSR or fallow, we have short and stiff KWS Parkin, which excels in the early-drilled spot, with early maturity to spread the harvest workload.
- Winter barley: ADM exclusive SY Baracooda is consistently high yielding and tall strawed, with good lodging resistance. We have overyeared stock available for early delivery onto farm if required.
- OSR: DK Excited is a great all-round hybrid variety that will suit most situations. With strong lodging resistance, RLM7, TuYV and POSH, DK Excited has a great package to offer. It is available on a market-leading establishment scheme, with £100/pack rebate on any crop that fails to establish.
- For more information click here to view the ADM Agriculture seed variety guide.
- Granular urea prices have now risen over $60/t month-on-month FOB Egypt.
- First reports of the most recent Indian tender suggest prices could be in the region of $510/t CIF, which are up a further $30/t from the most recent trades. This news continues to fuel a very firm market.
- Supply remains tight on the global nitrogen market. Koch and CF urea manufacturing facilities in the US remain shut down for maintenance, increasing US import requirements.
- UK AN producer CF has again withdrawn all terms from the market. Equivalent nitrogen products support higher prices and the UK continues to lag behind much higher European values.
- Parity with Europe for AN, urea and UAN must be seen before there is any opportunity for the UK nitrogen market to cool off.
- Potash and phosphate markets remain firm.
|Feed Barley £||Wheat £||Beans £||Oilseed Rape £|
|July21||140-145 (new crop a/a)||188-198||235||418-423 (new crop a/a)|
NB: Prices quoted are indicative only at the time of going to press and subject to location and quality.
“Although ADM Agriculture take steps to ensure the validity of all information contained within the ADM Agriculture Market Report, it makes no warranty as to the accuracy or completeness of such information. ADM Agriculture will have no liability or responsibility for the information or any action or failure to act based upon such information.”
ADM Agriculture cannot accept liability arising from errors or omissions in this publication.
ADM Agriculture trade under AIC contracts which incorporate the arbitration clause.
On every occasion, without exception, grain and pulses will be bought by incorporating by reference the terms & conditions of the AIC No.1 Grain and Peas or Beans contract applicable on the date of the transaction. Also, we will always, and without exception, buy oilseed rape and linseed by incorporating by reference the terms & conditions of the respective terms of the FOSFA 26A and the FOSFA 9A contracts applicable on the date of the transaction. It is a condition of all such transactions that the seller is deemed to know, accept and understand the terms and conditions of each of the above contracts.