Global grain markets briefly spike in response to US tariffs
© GNP Wheat markets rallied this week in response to heightened global tensions following the announcement of increased tariffs being imposed by the US.
UK feed wheat futures for the May 2026 contract lifted to £170/t on 23 March, before settling at £168.6/t midweek.
US president Donald Trump announced a new 15% global tariff after the US Supreme Court ruled that some of his earlier tariffs were illegal.
See also: Feed barley discount to wheat narrows to just £10/t
This led to backlash from countries around the world including the UK, which has not ruled out reciprocal action despite ongoing trade talks between the two nations.
Analysts at CRM Agri Commodities said wheat markets rebounded in response to the tariff announcement, with European wheat seeing the strongest gains in more than eight months.
However, some merchants have indicated that this price rally may be short-lived, with ample supplies of wheat globally keeping prices in check.
Norfolk-based trader Dewing Grain has projected that unless there are any fresh catalysts, wheat fundamentals will resume and markets will settle with plenty of grain still available globally.
Cereals demand in animal feed
Demand for cereals for use in animal feed in the UK is expected to remain firm throughout 2026, at 13.3m tonnes.
AHDB senior analyst Anthony Speight said: “Wheat usage as animal feed is forecast to rise 0.3m tonnes year-on-year to 7.1m tonnes, based on current forecasts for 2025-26.
“Livestock producers continue to compensate with additional cereals due to depleted forage reserves following last year’s challenging grass‑growing conditions.
“Production of compound animal feed is currently firm and broadly stable, with the beef cattle and dairy sectors driving much of the volume. Only modest change is expected in the near term.”
The AHDB forecasts that feed grain prices will remain under pressure in the short term, driven by large supplies in some of the major export nations.
It expects any sustained price rallies to be driven by weather events or geopolitical developments rather than by underlying tightness in market fundamentals.