- US wheat prices are up about $3/t on the week, supported by talk of lower southern hemisphere production and a weaker US dollar.
- The US winter wheat crop showed a slight improvement on the week, with NASS reporting 57% of the crop in either good or excellent condition, up from 51% a year ago.
- Canadian farmers are still battling between weather events in an attempt to complete harvest, as another blast of winter brought snow and rain to many areas, disrupting operations.
- Delays in planting the Brazilian soybean crop, due to a general lack of rainfall, may affect the sowing of the corn crop which follows once the soybean crop is harvested. This crop usually accounts for about 70-75% of the total South American corn output.
- Egypt’s state buyer GASC purchased 175,000t (120,000t French and 55,000t of Russian) of wheat for 15-25 December shipment. The Russian price was $3/t below last week’s cheapest offer.
- EU cash values remain supported by export demand and confirmation of French sales to Egypt in its latest international tender, albeit due to an apparent reduction in the freight rate.
- Soft wheat exports from the EU in the 2019/20 season reached 8.84mln t as of 3 Nov, up 42% from the 6.25mln t reported during the same period last year.
- UK futures prices are up £2/t on the old crop (May ’20 position) for the week, while new crop prices (Nov ’20 position) rose £3.50/t.
- Concerns continue to mount over wet weather delays to winter sowings in the UK. The window to drill winter wheat is still open but it is narrowing, and ground conditions are in some cases not going to be suitable for land work until the spring.
- The effect on the UK market has been to firm new crop prices towards import parity and old crop surplus is now priced to carry into the 2020/21 season as things stand.
- In summary, the US market took some support from a weaker US$, although the USDA report due out tomorrow is expected to show little change to either US or global inventories.
Thursday 7 November 2019
- The extended export window has not really created any more demand to buy or desire to sell.
- Domestic buyers are finding it harder than they thought to cover January to June demand as sellers remain absent from the market.
- Prices have risen slightly over the last week.
- Crop 2020 is all about the continuing autumn planting problems.
- We estimate that 80% of the intended winter malting barley has been sown with little chance of that figure rising.
- We continue to see increased interest in our spring malting barley contracts, especially our popular barley pool.
- US soybeans are trading within a narrow range ahead of Friday’s USDA report.
- At the start of this week, the US soybean harvest was estimated at 75% complete, up from 63% last week, vs an average of 87% average and 81% last year.
- Weather remains very cold with some snow around the Lakes turning into rain across the Delta, which will slow harvest progress.
- November’s meeting between the US and China has been cancelled and “phase 1” of a trade deal has now been pushed back to December. Both sides are unable to agree on terms. China is aiming to get all tariffs cancelled and is pushing to get an agreement signed before the next tariff increase on 15 Dec.
- Canada has less than 10% of the canola crop left to harvest and farmer selling is still very slow. This week agreed to import Canadian meat products. However, this agreement did not extend to Canola for the time being.
- Australia’s canola harvest is near 15% complete. Initial oils and yields are still behind last year. It’s now thought that some farmers in certain regions are concentrating on barley and wheat before cutting canola.
- Closer to home, attention is now turning to next year’s European rapeseed crop. Yesterday Strategy Grains released its first estimate of the 2019/20 crop at 19mln t, which is at the higher end. Others range between 18/18.5mln t.
- Matif rapeseed prices bounced back to trade at levels not seen since the start of October. Firmer palm oil prices have led the recent oil rally, with soy oil following suit yesterday.
- The overall strength in world vegoil is giving some underlying support to the market, but we still needed to be mindful of the direction of sterling going forward.
- The persistent wet weather in the UK is at the forefront of everyone’s minds with winter drilling well behind. Domestic millers much prefer winter varieties and there is a risk that we see a dramatic drop in winter oat production due to reduced acreage and reduced yields. We will probably see a corresponding rise in spring oat production.
- On old crop, the market remains largely unchanged, however fresh sales from the farm gate have decreased over the last few weeks, as the focus has shifted towards drilling, or the lack of it.
- Bids for old crop feed beans appear to be drying up, as shippers get covered against existing export requirements, and there is little fresh interest on the export market.
- Demand from Egypt for UK beans suitable for human consumption remains subdued. The buyers in Egypt are covering their requirements from Australia who are trading at a small premium to the UK, but considered a far superior product.
- With the wet weather continuing to delay autumn plantings, enquiries for spring cropping are increasing. We still have pea buybacks available for large blue peas and marrowfat peas. Please contact your farm trader for further information.
- It’s been another very busy week on spring seed, availability hasn’t changed on the week, but stocks have been dramatically reduced on all varieties still available.
- Spring wheat is still sold out across all varieties due to unprecedented demand.
- RGT Planet & Laureate are still available in very limited quantity. LG Diablo is available as a high yielding feed option with premium potential in the north.
- Combining pea buyback contracts have unsurprisingly seen an increased demand from growers. Our key advice would be to still select fields that are free-draining in the spring, as peas will not want to sit in water-logged soils during the early stages. Kabuki marrowfat and LG Stallion, LG Kingfisher & Daytona blue pea seed, is still widely available.
- Spring bean stocks are continually decreasing, so we would urge growers to act fast and book seed requirements.
- Global urea prices have slipped on increased exports from China and slower uptake from typically big buyers at this time of year, including the US and Brazil.
- Support is anticipated to come from the next Indian tender in Q4 and deferred demand from Europe and the US in Q1 of 2020. Manufacturers have also been watching as energy prices have risen with natural gas beginning to touch the highs of 2019.
- In the UK, the fertiliser market is illiquid. Demand for nitrogen is shrinking as drilling and establishment concerns over winter varieties continues.
- Buying opportunities are becoming apparent as importers continue to compete for current business and to keep product moving.
|Feed Barley £||Wheat £||Beans £||Oilseed Rape £|
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.