Feed market update - 20 April 2016
Read our latest summary of developments on global markets for cereals and oilseeds
On Tuesday, UK feed wheat futures prices (May-16) recorded an increase of £1.35 on the week, closing at £105.70/t. Furthermore, May-16 Chicago wheat and maize futures prices closed up week on week. Across Europe, winter crops continue to be reported as in good condition. Strategie Grains increased its forecast of EU soft wheat production for 2016/17 by just over 1Mt from March's estimate, to 145Mt, based on the conditions to date (151Mt in 2015/16). Brazil’s second maize crop is currently expected to reach a record level of 57.1Mt this season but concern has been growing about the impact of dry weather on the crop. Over the last two weeks, the malting barley premium over feed barley has declined to season lows. The squeeze between malting and feed barley prices has been a factor of increased barley inclusions in animal feed rations this season.
Chicago soyabean futures prices (May-16) closed up $18.10 on the week on Tuesday, settling at $362.11/t. May-16 Paris rapeseed futures prices also closed up Tuesday to Tuesday, albeit by less. Rapemeal (34%, ex-mill Erith) for April delivery was at £162/t on Friday, £4 more than a week before. Bullish sentiment has crept into soyabean markets, chiefly driven by fears over wet Argentine weather during harvest. As at last Tuesday, the funds (traders in futures markets described as ‘managed money’) held their largest net long on Chicago soyabean futures in nearly 9 months. A net long indicates that the funds hold more contracts bought than sold, suggesting a bullish view on the market, while a net short suggests the opposite view.
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Millie Askew, Analyst
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