Feed market update - 10 June 2015
Read our latest summary of developments on global markets for cereals and oilseeds.
Weather proved to be the main market driver over the past week. US weather concerns have provided support to the market, leading to increases in international wheat futures. UK feed wheat Nov-15 contracts were £129.50/t at Tuesday’s close, up £4.75 on the week. The EU Commission have increased their estimates for both maize and barley production in 2015/16 in their latest balance sheet update, while the wheat estimate was largely unchanged. Despite this, weather remains a key watch point. Spain, France and Germany, have been gaining the attention of the market over the past week as dry weather conditions have been experienced. Rain is forecast in the coming week for France and northern Spain, although Germany is expected to remain relatively dry. While this could provide some support to EU prices, there is still a fair way to go until harvest.
As at Friday (5 June), Hi-Pro soyameal (ex-store east coast, spot delivery) was £283/t, down £8 week on week. Nov-15 Paris rapeseed contracts steadied over the last week, closing at €375.00/t on Tuesday, down €2.50 on the week before. Details of the extent of Canadian frost damage have emerged with sources indicating 4-5% of the total Canadian canola area may have to be replanted. The planted area had already been reduced by unfavourable economics for the crop and, with dry conditions not favouring newly planted crops, further cuts to the area may yet be seen. Preliminary Australian grain production figures from ABARES show a minimal expected impact from El Niño weather conditions. Forecast yields were relatively unchanged from last year following sufficient rains early in the season. However, reduced planted area in key producers and the frost damage in Canada could mean tighter rapeseed supplies for the 2015/16 season.
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