UK wheat prices have taken a tumble in the week to 16 August, losing £5.80/t to average £127.80/t ex-farm for spot delivery.
Values were affected by the release of the US Department of Agriculture’s world supply and demand estimates last Thursday (11 August), which pegged 2017 global wheat production at a record 264.7m tonnes, up more than 4m tonnes on the July report.
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Production in the EU, US and Canada was estimated down 2.9m tonnes, but this did little to counter the projected 8.6m-tonne increase in Black Sea countries, taking total production there to 133.8m tonnes. As the UK’s main export competitors, this drove domestic prices down.
Adding to the pressure were figures showing the UK imported more than 1.9m tonnes of wheat in 2016-17 against exports of 1.4m tonnes, meaning UK stocks could be larger than expected.
The bad weather in the UK has caused some milling wheat to lose quality, potentially leading to an increase of feed wheat on the market.
Malting barley crops have also been damaged by the wet conditions, leaving traders concerned that stocks could be downgraded to feed.
However, spot feed barley prices have remained fairly stable on the week, losing just 40p/t to average £115.50/t ex-farm.