November Arable Update

We often look at currency when it comes to grain markets and this month is no exception.  The euro took another dip and is now at around €1=70p, which means that UK grains are even less competitive against European equivalents. With a large harvest after record yields, export trade needs to pick up to reduce the high surplus stocks.

But with such low prices over the past seasons surely less wheat is being planted for harvest 2016 and prices will go up again? But indications from the Early Bird Survey (see article), Strategie Grains and the International Grains Council suggest that wheat plantings are only slightly down onlast years. However there has been some bullish news. Weather issues have been reported in Ukraine with local analysts estimating that poor emergence could lead to an 8-11% drop in production but it is far too early in the season to start getting too excited, the likely impact on the grain market is minimal, what doesn’t establish well can always be re-drilled in the spring. A number of reports have also focused on dry weather in India but again it seems like grappling for a glimmer of hope.

Little demand from crushes is stagnating the rapeseed market in Europe, on top of this a cargo of 90,000 tonnes is making its way to Europe from Australia. The rapeseed market is unlikely to see an influx of buyers before the New Year.

The large UK bean crop is seeing prices under pressure despite plenty of demand from feed compounders. Currency availability remains a problem for shipments to Egypt with the problem likely to persist for some time. A number of producers have also faced problems with moisture content about the 15% desired, there are only a finite number of places for beans with a higher moisture content.