Tight supply and currency push grain prices higher
© Tim Scrivener UK grain prices rose across the board in the week to Friday (11 May), driven by currency and tightening stocks in the final few weeks of the old crop year.
Breadmaking wheats gained most, with spot prices rising by about £7/t on the week to average just over £167/t spot ex-farm.
Spot feed wheat values rose by about £3/t to range from £137/t in the far south-east to £156/t in Norfolk, Suffolk and the Scottish Borders, averaging £152.50/t ex-farm.
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Feed barley was up just £1/t to average £143/t spot ex-farm, in a range from £130/t to £150/t.
A stronger US dollar against both the euro and the pound has made European grain more competitive, at the same time as UK markets have seen supply tighten further.
Futures market prices show a smooth upward price transition from old to new crop, rather than the traditional dip in anticipation of plentiful new crops supplies, reflecting the tightness in the market.
London’s November 2018 feed wheat futures contract stood at £152.50/t mid-afternoon on Friday (11 May), while July 2018 was £148.20/t delivered.
New crop prices are in a similar regional range to those of old crop, with expectations of another relatively tight supply as many crops have had to cope with poor conditions since drilling.