Grain markets have drifted over the past week, with British wheat exports continuing to struggle against adverse £:€ exchange rates.
London wheat futures ended the week to Tuesday down by £4.60/t for March and £3.65/t for November, putting physical trade at about £114/t ex-farm for spot movement. “There is increasing pressure on UK wheat to find export demand if a large carry-over into next year is to be avoided,” said HGCA senior analyst Amandeep Kaur Purewal.
By the end of December, only 938,200t of UK wheat had been exported – just 5.6% of production. At the same time, imports had risen due to poor milling wheat quality and cheap maize supplies.
However, EU wheat exports were going well, as were British barley exports, she added. “It’s important to keep in mind that when the UK trades outside of the EU, much larger consignments are being used – so a small number of export transactions can have a noticeable impact.”
Oilseed rape markets remained in deadlock, with buyers awaiting confirmation of the likely record South American soya harvest. With very thin trade, both wheat and oilseeds futures markets were likely to over-react to small pieces of news, making physical trade more difficult.