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

AHDB’s first harvest progress report of 2020 points to yields of both GB winter oilseed rape and winter barley being sharply down on both last year and the five year average.

This season, like most seasons in recent history, Black Sea grain supplies will be pivotal to the direction of global markets. Adjustments to production estimates from the Black Sea regions set the tone for domestic and international prices, especially in a year when other Northern Hemisphere producers, most notably the US, EU and Ukraine, are set for smaller wheat production.

Many farmers across Europe have probably had a growing season they would rather forget, from a wash away autumn and winter in parts, met by a hot and dry spring.

The International Grains Council its 2020/21 global wheat production forecast reducing the gap to predicted demand. A smaller surplus could mean greater potential for volatility in prices.

Weekly Market Report

Global wheat prices declined last week after Russian consultancy IKAR increased its forecast for the Russian crop from 76.5Mt to 78.0Mt last Monday (27 Jul).

Global markets were generally supported last week by short term delays to harvest and reductions in the forecast of the global wheat surplus.

There’s a lot of uncertainty over Northern Hemisphere crops sizes and this is underpinning global prices for the time being. Confirmation of existing forecasts is likely to be bearish, while further cuts (if large enough) could add support.

The USDA’s latest supply and demand (WASDE) report suggests a reduction in global wheat supply for 2020/21, driven by reduced wheat production in the EU, US and Russia.

Analyst Insight

Domestic wheat prices will be more exposed to global fundamentals this season following the hefty decline to UK wheat production estimates. We are likely to sit closer to import parity levels.

Last week we published the results of the 2020 AHDB planting and variety survey (PVS). Unsurprisingly, estimated wheat areas were down year-on-year across all regions of GB.

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.