Spot grain prices continued to rise this week, despite sterling steadying.
October feed wheat values rose by just over £2/t, to between £121-£130/t ex-farm on Friday, depending on region, and averaging £127/t.
Despite quality wheats being in demand globally, UK milling wheat firmed by slightly less than feed wheat, to average £137.45/t ex-farm for October.
Spot prices saw the biggest gains as merchants sought immediate supplies to cover shorts.
The UK is, as expected, seeing increased activity on milling wheat exports, with a first shipment of 33,000t of a possible 500,000t sent to Algeria this week, replacing wheat from that country’s more traditional supplier, France, where quality problems mean it cannot serve many of its usual export customers.
More UK milling wheat shipments are set to start loading in the next fortnight.
UK exports to the EU in August and September were more than 390,000t, a rise of more than 210,000t on the same period last year and way above the five-year average of 140,000t.
Exports outside of the EU accounted for 14.5% of trade compared to 2% over the past five seasons, due to the weakness of sterling.
US maize prices are rising on higher demand from the ethanol sector and a slightly delayed harvest, in turn bolstering wheat values.
Strength has also come from continued quality concerns in Canada and Australia and the pace of US wheat exports, which are up 29% year-on-year, said Gleadell managing director David Sheppard.
Analyst Strategie Grains this week cut 600,000t from its 2016 EU soft wheat harvest estimate, making this 135.8m tonnes, which is 15.5m tonnes less than the 2015 harvest.
It also forecast the 2017 EU soft wheat area very similar to 2016 season, broadly in line with the International Grains Council’s forecast.