Wheat markets have improved over the past week, supported by stronger export demand. Spot ex-farm prices increased by £3/t to around £91/t, depending on location, although farm sales remained slow.
The weaker euro against the dollar had sparked new exports from France to South America this week. “With the UK ideally placed below the French we are in a good position to buy demand, helping to support our market,” said a report by Glencore Grain. “Growers need to be aware of currency – if the pound strengthens this will soon change.”
Latest data from HM Revenue & Customs show the UK exported 210,782t of wheat in January, bringing the season’s exports to 1.22m tonnes so far – almost half that exported by the same time last year and 78% of DEFRA’s total season estimate. Barley exports are even further behind, at just 35% of forecast stocks, said the HGCA’s market report. “UK feed wheat values remain discounted to US maize, a relationship that will have to be maintained to stimulate demand.”
One bright spot for global markets could be the discovery that a large proportion of India’s grain surplus was rotting in outside stores, which could reduce global stocks dramatically, said traders.