Cereals and oilseeds market analysis

Keeping up to date with all of the latest market information is crucial to developing a marketing strategy for grains and oilseeds. Here we have all of our latest analysis and insight to help guide you through market movements and provide a clear, impartial view on what it all means.

Grain Market Daily

As northern hemisphere harvests were underway, global wheat markets were pressured as we commenced the 2020/21 marketing year.

Yesterday saw the release of the latest AHDB planting and variety survey, detailing regional planting figures across the different crops. One of the key highlights of the survey is the 25% reduction year-on-year in the area planted to wheat.

Today marks the latest release of the AHDB Planting and Variety survey results, providing a planted area estimates for the 2020/21 season. This season has cast many challenges to UK growers.

The current view of the global wheat market is that it’s looking well supplied in 2020/21 but there’s still potential for greater pressure or more support if crops come in larger or smaller.

Weekly Market Report

Global grain prices received a sharp boost last week, particularly maize. Prices moved higher following the release of the USDA acreage report last Tuesday; maize plantings are estimated at 37.2Mha, down 2.0Mha from March’s intentions survey. If we see trend yields and abandonment, the US could still be set for a record crop. With a reduced crop area, weather again becomes an important swing factor for maize markets, particularly with the crop now silking.

Global grain prices fell last week amid upgraded crop forecasts, plus harvest pressure and worries about the rate of coronavirus infection in parts of the US.

Global new crop wheat futures were in retreat last week, falling on US harvest pressure and a basic lack of bullish drivers. New crop maize values continued to float at their current support level, before making small gains on Friday.

Concerns remain about European and Ukrainian crops and the impact of recent rainfall. However, renewed confidence from SovEcon in Russian production coupled with the US harvest progressing at pace could cap any gains.

Analyst Insight

What might affect the price direction of new-crop rapeseed? With harvest rapidly approaching, let’s revisit these factors and the impact they could have.

As the UK enters the 2020/21 marketing year, when wheat supplies are expected to be tight, we are currently seeing less pressure on feed wheat prices for harvest delivery.

UK feed wheat futures for Nov-21 delivery closed at £152.40/t, some £15.35/t below the Nov-20 contract, but similar to Nov-20 and Nov-19 prices this far ahead of planting.

During our barley week last week, we highlighted the increase in trade tensions between China and Australia, with the former potentially imposing a $74/t tariff on imports of Australian barley. This offers a high degree of price risk for domestic barley, particularly given the significant export volumes expected from the UK next year.