Feed market update - 14 January 2015
Having come close to the £140/t mark on 7 January, UK feed wheat futures have since dropped to a 4-week low.
Having come close to the £140/t mark on 7 January, UK feed wheat futures have since dropped to a 4 week low. May-15 futures fell through most of the week closing at £133.65/t (13 Jan) down £5.55/t on last Tuesday. Markets fell despite further details emerging of Russia increasing informal grain export taxes. Market sentiment was overwhelmed by the release of new USDA data showing large global stocks. This bearish news has brought the fundamentals of supply and demand back into focus. In the UK Defra figures suggest it seems unlikely that lower prices in feed grains will result in improved demand.
UK rapemeal (34%, ex-mill Erith, December delivery) was £202/t on Friday (9 Jan), up £11/t on the previous week. Hi-Pro soyameal prices (ex-store East Coast, December delivery) averaged £335/t, £3 lower than the previous quotation of mid-December. Latest US soybean production figures have increased previous stock estimations by just over 1.5Mt. This combined with higher Brazilian crop expectations and weak crude oil prices, creates a bearish environment for oilseeds going forward.
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