HGCA: UK grain weaker for second week

UK delivered wheat prices were generally 1-2 lower over the week. Meanwhile, LIFFE futures were 80p-1.50 lower. Over 300,000 tonnes were traded.

Wednesdays close (14 March) was around 1.50 below Fridays as market concerns peaked mid-week regarding grain exports and foot-and-mouth disease.

MAY and July LIFFE wheat futures, in Euros, have fallen by 5-6/t since the first foot-and-mouth case was confirmed on 20 February.

Over the same period, MATIF wheat futures have generally been at most 1 lower.

Traders note that this has prompted some interest in UK wheat from EU consumers, particularly in light of the EU Standing Veterinary Committee statement on foot-and-mouth and the availability of supplies from main UK producing regions largely unaffected by foot-and-mouth movement restrictions on grain.

LAST week some non-EU countries signalled reservations regarding the importation of UK-origin grain because of foot-and-mouth.

Work has focused in the last week on answering specific concerns which, together with the advice of the EU SVC that “grain (does) not present any risk for the spreading of the foot and mouth virus”, have addressed the immediate questions of most countries.

UK cropped area at 1 December, 2000 was detailed in the December Survey results published on 14 March.

UK wheat area was down 35% at 1.36m ha, barley area was down 24% at 466,000 ha whilst oilseed rape was up 11% at 345,000ha.

It should be noted that wheat plantings in particular continued well into February, so final harvested area will be higher than the December Survey results.

However, a smaller wheat crop than this season is expected in 2001.