2024 Grain Market Outlook briefing round-up: Grain market daily

• UK feed wheat futures (Nov-24) climbed £1.00/t over yesterday’s session, closing at £179.20/t. New crop futures (May-25) closed at £192.95/t, up £1.00/t from Monday’s close.
• UK feed wheat futures tracked global wheat markets up yesterday. Global wheat prices were boosted by short covering as traders adjusts for the outcome of the US presidential election and the USDA’s US monthly grain stock report due out on Friday. Although welcomed showers in the US plains and improved winter wheat condition in the US limited price increases. US commodity markets have slipped back today, with the US dollar strengthening, following the outcome of the US election.
• Paris rapeseed futures (May-25) closed at €510.50/t yesterday, down €4.25/t from Monday’s close. European rapeseed futures followed the wider vegetable oil complex down yesterday. Malaysian palm oil futures were down yesterday due to profit-taking ahead of the Indonesian Palm Oil Association (GAPKI) conference later this week.

Sign up to receive the Weekly Market Report and Grain Market Daily from AHDB.

Yesterday we held our 2024 Grain Market Outlook (GMO) briefing in Birmingham. The event was well-received by those who attended, with engaging discussions around both domestic and global markets, as well as government policy and its impact on UK food production.

Here are the key highlights from the briefing.

A season of contrasts in global markets

While wheat supplies are expected to be tight this season, the picture for maize is looking more comfortable. Overall, the global grain market is somewhat fragile, with a projected deficit, despite lacklustre global demand. With a stronger reliance on Southern Hemisphere crops this season, production in these regions is a watch point. Other areas to watch are the slowing of the Black Sea export pace and trade policies, which may change, following the results of the US election.

For global oilseeds, while rapeseed markets are supported by tight supplies and high palm oil prices, soyabeans are acting as somewhat of an anchor with ample supplies (even more so now concerns are easing for South American crops).

UK supply and demand – 2024/25 and beyond

Despite entering the season with nearly 3 Mt of wheat, the drop in production this season is expected to outweigh the rise in carry-in stocks, strong imports and a reduction in consumption, to leave us with the tightest balance since 2020/21. In 2024/25 the barley balance sheet is also expected to be tighter, driven by higher domestic consumption on the back of lower availability.

Looking further ahead, long-term trends show steady demand for flour milling and limited growth in animal feed. If the current trends of a reduction in alcohol consumption continues, barley usage by brewers, maltsters, and distillers longer term could pull back, but as it stands there is no major cause for concern.

For oilseed rape, the decline in UK rapeseed production is outweighing the decline in crush volume, increasing our domestic reliance on imports.

To what extent will the SFI remove land used for food production?

While reducing crop areas for SFI actions can negatively impact farm profits, using less productive land can be beneficial. It’s expected that SFI actions will be implemented on existing uncropped arable land, which makes up 5-6% of England’s total croppable area, with the potential for an additional 1-2% to be added due to switching out of problematic crops, further growth in applications and short-term reactions.

Other factors discussed that could threaten domestic food production include the impact of the  20% inheritance tax on agricultural assets above £1 million starting April 2026 and a steeper cut in Direct Payments in 2025.

If you missed our Grain Market Outlook briefing, there’s still chance to get involved. Join our webinar tomorrow, click here to book now.

Sign up to receive the latest information from AHDB.

While AHDB seeks to ensure that the information contained on this webpage is accurate at the time of publication, no warranty is given in respect of the information and data provided. You are responsible for how you use the information. To the maximum extent permitted by law, AHDB accepts no liability for loss, damage or injury howsoever caused or suffered (including that caused by negligence) directly or indirectly in relation to the information or data provided in this publication.

All intellectual property rights in the information and data on this webpage belong to or are licensed by AHDB. You are authorised to use such information for your internal business purposes only and you must not provide this information to any other third parties, including further publication of the information, or for commercial gain in any way whatsoever without the prior written permission of AHDB for each third party disclosure, publication or commercial arrangement. For more information, please see our Terms of Use and Privacy Notice or contact the Director of Corporate Affairs at info@ahdb.org.uk  © Agriculture and Horticulture Development Board. All rights reserved.