Strong Pound puts barley under pressure

By FWi staff

OLD-CROP barley values continue to come under pressure, with the strong Pound making exports from the UK increasingly difficult.

Feed barley has fallen £4, from £79.30/t at the start of the month, to just over £75/t ex-farm.

Futures values are also suffering, dropping £2 last week to £75.75/t for May deliveries and slipping £1.75 for November deliveries to £76/t.

News that the Saudi Arabian government might sell some of the 1.2 million tonnes of stocks it holds to Saudi consumers is making the prospect of new business for UK shippers more unlikely, said Ian Wallis of Cargill plc.

Export prospects were further weakened when the EU grains management committee failed to a give any open-market export licences.

The barley export programme is now over for the season and outlets for non-intervention barley are limited, said a spokesman from Banks Agriculture.

Intervention prices are suffering from the strong Pound and values have slumped over £3/t since the start of the year, when the intervention price was at £86.69/t.

The price for deliveries made today (Tuesday) fell 61p over night and now stands at £83.63, the lowest it has been since the Euros introduction.

Any increase is now dependent on a fall in the value of Sterling or a rise in the Euro.

But even with falling values, intervention still stands over £8.00/t above ex-farm prices and traders say that, if the quality is right, intervention remains the market to enter.