Feed market update - 17 December 2014
Despite May-15 UK feed wheat futures trending downwards throughout most of the week, on Friday fears resurfaced that Russia may lower grain exports in order to help solve its problem of high domestic inflation.
Despite May-15 UK feed wheat futures trending downwards throughout most of the week, on Friday fears resurfaced that Russia may lower grain exports in order to help solve its problem of high domestic inflation. On Tuesday, May-15 UK feed wheat futures settled at £139.00/t, up £4.05 on the previous week. This rebound in UK wheat prices was also echoed across both the May-15 Paris and Chicago wheat futures contracts. In their updated World Agriculture Supply and Demand Estimates (WASDE) released last week, the USDA revised their forecasts for global output of wheat and maize higher compared with their earlier estimates. In October, for the first time since May 2012, HMRC reported that the volume of wheat exported by the UK was higher than the volume imported. However, there is still a lot of work to be done, as the export pace is lagging behind that of previous large production years.
The events of last week also introduced a degree of volatility to oilseed markets. Chicago soyabean prices rose prior to the release of the WASDE, in anticipation of lower US stocks. With global production raised higher, the report subsequently initiated a decline in prices. The US National Oilseed Processors Association’s (NOPA) latest crush data showed the fourth largest crush on record in November. However, because this figure was less than that expected by trade estimates, it resulted in a decline in Chicago soyabean futures prices, falling by $8.45 since Friday’s close, to settle at $380.81/t on Tuesday. UK rapemeal (34%, Ex-mill Erith, December delivery) was £186/t on Friday (12 Dec), up £5 on the previous week. Hi-Pro soyameal (Ex-store East Coast, December delivery) was £338/t on Friday, up £1 on the week.
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