Wheat markets have improved over the past week, amid strong export demand and slow farm sales.
London futures reached £102/t for July on Tuesday (21 April) – the highest level since early February and £2/t up on the week.
“The rash of export business from the UK and France which we saw at the end of last month now seems to be bearing fruit in terms of better prices,” said a report from Glencore Grain. “Large cargoes sold to a series of exotic locations in the Americas, North Africa, the Far East and even, it is rumoured, to the USA, will require filling over the next few weeks and in the UK this has led to better demand, especially for feed wheat.”
This trade was reflected in Strategie Grains’ latest monthly report, which cut its estimate of EU ending stocks by 1.7m tonnes. Although this still leaves a large surplus in France and Germany, the analyst believed the UK surplus would be shipped by the end of the season.
However, the UK would have to remain competitive, particularly when Ukraine re-entered the market. Trade had almost halted amid disputes with the government, but once it re-started sales would be aggressive, Glencore said.