Read our commentary on latest developments in the global cereals and oilseed markets.
Please note that from now on this commentary will only be updated monthly. To follow developments in cereals and oilseed markets in the meantime, please see the markets section of the website of AHDB Cereals & Oilseeds.
March 2019 Update
UK feed grain prices fell again over the reference period. Sterling continued to strengthen over the month, with grain prices falling to stay competitive with EU markets. Relatively slow global exports have led to a build-up in grain supplies, acting as a ceiling for prices. UK barley prices continued to fall amidst increased maize usage, up 134% on the year for January. Barley usage in January was at its lowest levels since 2012/13. The feed barley discount continues to grow, now £24.80 compared to feed wheat.
Towards late February, there was news of the Ensus plant restarting its bioethanol production three months early. Despite initial positivity, the plant looks set to focus on maize as its primary feedstock. As such, wheat markets felt
New-crop wheat futures (Nov-19) began to fall over February, narrowing the spread to old-crop (May-19). Expectations of a larger new-crop harvest have pressured futures markets. Weather remains the key driver for crop forecasts, with warmer conditions in February contributing to good crop establishment.
Over the month, UK delivered rapeseed prices fell in line with declines observed on the continent. Reduced demand from the biofuel sector has led to an increase in stocks. In addition, increased pressure from vegetable oil markets has also impacted prices. Furthermore, a strengthened sterling meant domestic rapeseed prices fell to remain competitive.
Progression in US-China trade talks was positive for soyabean markets over the last month. Prices were initially raised due to a Chinese commitment to purchase 10Mt of US
Looking forward, the forecasted tightness in new rapeseed crop supply could support prices. Poor establishment conditions on the continent and extensive Cabbage Stem Flea Beetle damage reported in the domestic crop has impacting crop area.
Alex Cook, Trainee Analyst
Alex.Cook@ahdb.org.uk, 0247 693 5746