UK feed wheat price rises after surprise in global market

The UK feed wheat price has risen sharply following the publication of a surprising US Department of Agriculture (USDA) report on grain stocks and prospective plantings.

Released yesterday (31 March), the USDA report showed a lower forecast corn planted area and significantly lower soyabean stores than anticipated.

The news caused the UK feed wheat futures price for November 2021 to rise from £161.25/t to £164.5/t by the end of the day, after having fallen by almost £5/t in the week to Tuesday (30 March).    

By midday today (1 April) it had settled at the £164.5/t mark. 

See also: Trading grain: Advice on locking in to profitable prices

‘Mysterious’ figures

The US forecast corn planted area for 2021 was 37m ha, falling short of what markets had anticipated, although this is tempered by larger-than-expected stocks.

The soyabean area was estimated at 35.5m ha, up 5% from last year but still down on expectations. Total stores on March 1 were down a huge 31% on a year earlier.

Meanwhile, the wheat planted area was broadly in line with estimates at 18.8m ha (up 5% from 2020) and stores were down just 7%.

Grain trader Cofco International said these results ignited corn and soyabean futures contracts, which dragged wheat along, eliminating the majority of ground lost over the past week.

“If these numbers are to be believed, it puts corn and soybeans into a very tight situation, leaving no room for any added weather concerns,” the merchant reported.

“However, how the USDA can be so far off what they presented at the Ag Forum only a few weeks ago is a mystery and puts a high degree of uncertainty into the validity of the numbers published last night.”

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