Market Report

Thursday 8 April 2021

Please click *here* for this week’s market updates on the ADM Agriculture YouTube channel.

Wheat

  • The wheat market is all about weather for both northern and southern hemispheres, including how high new crop corn can rally and how much spill-over support enters the wheat complex.
  • US weather remains mixed, with good moisture seen for the Midwest, although dryness concerns remain in the southern and northern plains and into Canada.
  • In its initial report for 2021, USDA’s National Agricultural Statistics Service reported US winter wheat condition as 53% good/excellent, down from 62% a year ago, with 4% headed compared with 3% last year.
  • NASS also reported 2% of the intended corn acreage and 3% of the intended spring wheat acreage planted.
  • US prices are virtually unchanged on the week as the aftermath of USDA’s bullish corn stocks/planting data is slowly absorbed into the market.
  • The trade is expecting lower US corn stocks to be forecasted in USDA’s WASDE report due out tomorrow, mainly due to higher exports and domestic usage. This will intensify the focus on US plantings and the need to buy additional acreage.
  • Australia and Argentina have received beneficial rains ahead of sowing and the EU and Black Sea regions report favourable conditions. However, the rain is slowing the Argentinian corn harvest which is seen only at 8% complete as of 31 March.
  • Consultant APK-Inform sees the 2021 Ukrainian grain crop rising by 13% to 73.8mln t, allowing the country to export 54.2mln t of grain in the 2021/22 marketing season.
  • FranceAgriMer estimated 87% of the country’s wheat crop was in good/excellent condition as of 29 March, unchanged on the week.
  • In the UK, the recent cold dry spell, with minimal rain in the forecast, is starting to raise concerns over soil conditions, especially for recently sown spring crops and for winter crop development.
  • UK old crop prices are down £3-4/t on the week, while new crop slipped £1/t, with sterling slightly weaker.
  • More immediately, Egypt’s state buyer GASC purchased 290,000t of Russian and 55,000t of Ukrainian wheat for 1-10 August shipment at a recent international tender.
  • However, SovEcon has lowered its forecast for Russia’s 2020/21 wheat exports to 38.9mln t, as the country’s domestic market is adjusting to the new tax system more slowly than expected.
  • Ukrainian grain exports have fallen by 23% to 35.7mln t so far this season, including 14.4mln t of wheat, 16.6mln t of corn and 4.1mln t of barley.
  • EU soft wheat exports had reached 20.26mln t as of 4 April, down from 26.33mln t cleared by the same week last season but from a smaller crop.

Malting Barley

  • The malting barley market remains very quiet with little buying interest.
  • In the EU brewers and maltsters remain nervous due to the continuing COVID-19 problems.
  • EU and UK growers are busy on the land and are not willing sellers.
  • EU spring barley sowings are going very well and in the UK plantings are nearly complete.
  • Crop 2022 remains very well supported and premiums are above the 10-year average.

Feed Barley

  • Feed barley markets, both domestically and for export, remain extremely quiet and values are once again tracking sideways.
  • Softer sterling on the week has theoretically increased our competitiveness for exporting, although demand is not to be found anywhere. Buyers in Ireland have sufficient cover. Cheaper German barley is still undercutting us into the Netherlands.
  • Old crop origination is still very slow and it does not feel like there is very much barley left on farm.
  • The spring planting campaign is as good as finished after a long spell of dry weather, although the forecast continues to look dry. Sellers, both farm and trade, are becoming increasingly cautious as a result.

Rapeseed

  • US markets have traded higher after last week’s USDA report, but remain rangebound this week. USDA’s ending stocks report will be out on Friday, providing further direction to what seems a bit of lacklustre market, with traders being very cautious about their next move.
  • South American weather is looking mostly dry with scattered showers particularly around Argentina. However, soybean crops have reached maturity so weather is not as important as it was. All growers need now is good harvesting weather to get crops in the shed.
  • Our attention now turns to North American weather, with planting just starting again after winter. There is rain in the upper Midwest and South East, although the plains remain dry as does most of Canada. This weather has has been very supportive for US farmers to get out into the fields. However a cold snap, which is forecast for next week, may halt planting progress if it materialises.
  • China has remained quiet this week. Rumours continue about the possibility of rising African Swine Fever cases, and lower soya crush margins are possibly reducing buying activity.
  • Matif rapeseed fell sharply on old crop with little demand around. The effects of the recent cold snap on flowering OSR will soon become apparent – fingers crossed there is not too much damage.
  • Canadian canola has not followed Matif down and remains $13 off the highs.
  • Crude oils started the week pushing two-week highs. Veg oil prices rebounded on news of fresh demand, particularly from India. However, towards the end of the week they started to follow CBOT down and traded below the highs as demanded tailed off.
  • Sterling started the week very strongly due to the UK strong vaccine rollout and confirmation that lockdown easing will continue on Monday. However, as the week went on the pound weakened due to concerns about the AstraZeneca vaccine. Overall, the sentiment is that it will rebound, it is just a matter of time.

Pulses

  • The old crop bean market remains under pressure as demand is hard to find. With limited demand on the horizon, it is likely that prices will continue to drift lower in the weeks to come.
  • The new crop market continues to be guided by London wheat futures. Physical bean prices have depreciated in recent weeks to a greater extent than wheat futures, as we saw increased selling pressure as plantings gathered pace. New crop bean plantings are approaching completion with much of the crop planted into reasonable conditions, but the dry forecast for the next few weeks is a potential red flag.
  • New crop contracts for beans and marrowfat peas remain available. Please contact your farm trader if interested.

Seed

  • For any late spring cropping opportunities we have the following pea seed available: large blues Bluetime and Blueman, Manager white peas and Kabuki marrowfats – all on market-leading buybacks
  • Looking towards the autumn, we have consistently high yielding and stiff-strawed SY Baracooda hybrid barley, with overyeared stocks available for early delivery onto farm.

Fertiliser

  • Global prices have slipped slightly in the east due to Chinese export capacity, but a premium price is still being achieved in the west (North America).
  • In the UK, granular urea continues to be a good option for growers, thanks to cooler weather and fast delivery times.
  • UK ammonium nitrate producer CF has extended its pricing from March, with good availability and short delivery times on full loads for all products.
  • Liquid UAN prices also remain stable, with short delivery timescales for forward and spot bookings.
  • Phosphate levels continue to rise. Replacement values are still not being achieved in the UK, indicating potential for higher values. ADM Agriculture can offer alternative 0PK products as well as straights and blends.
£/€ £/$ €/$
1.1585 1.3745 1.1865
Feed Barley £ Wheat £ Beans £ Oilseed Rape £
May21 154-169 190-200 216-221 416-426
NB: Prices listed may vary depending on area.

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.

Terms and Conditions of Purchase.

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.

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