International Grain, Seed and Fertiliser Merchant

Market Report

Thursday 20 July 2017

Feed Wheat

US Chicago market has seen continued fund long liquidation, trading down almost $15/t on the week.  Spread trading (selling Chicago and buying Minneapolis) has kept the quality wheat market firm, supported by ongoing dryness concerns and deteriorating crop ratings.

EU markets are also weaker, trading down €7/t on the week.  French wheat harvest continues to move northwards, with 30% harvested a/o 10th July.  Harvests have also commenced in the Black Sea region after rains caused a significant delay, with yields reported higher in Russia, but lower in the Ukraine.

With Russian yields better than anticipated, estimates for the 2017 grain crop have been raised, with analysts now seeing the current wheat crop matching, or even exceeding, last season’s record.  However, the strength of the ruble continues to limit farmer selling, pushing up export prices at a time when exporters are executing large volumes of export sales. EU weather maps keep rain across much of Germany, Poland and the Baltic states, meaning uncertainty over final yields and quality.

UK prices are trading almost £5/t down on the week, following the other exchanges.  Harvest has commenced (rape seed and barley) with the odd reports of early wheat being cut, although the rain may curtail activity over the next couple of days.  The trade is waiting to see what they are dealt with quality wise from this year’s harvest.

In summary, uncertainty remains over production of the higher quality wheat in the US, Canada and Australia, while rains may yet impact upon quality within the EU.

Malting Barley

First results from UK winter barley crops are very mixed with some high screenings present, but overall, they appear to be better than the qualities seen last season.  There is still a long way to go and the recent showers will hold off progress.

Prices have eased over the week due to more positive results from EU producers.  Yields are average to slightly below average in France, and average in Germany, where the main spring barley region has begun harvesting.  Scandinavia and UK spring crops still look promising.

In Australia, weather concerns are increasing due to above average temperatures and a lack of rainfall bringing stress to new crop emergence, most significantly in South and Western Australia.

Rapeseed

The market is currently in a state of flux as traders attempt to understand the potential impacts of the worsening heatwave in the US Mid-West on soybean production, the threat of hot, dry weather on the developing Canadian Canola crop and reports of improving rapeseed yields in Northern Europe.

USDA surprised and disappointed the market with its yield forecast in the July report, and we are now looking to see if it will adjust predictions on the 10th August.

The weekly crop rating reports and the hot dry weather in the Western Mid-West would all suggest we need to see a sharp decline in the US soy production this autumn, but we will need to see confirmation of this for the market to take another step higher.  Until we get this confirmation, we will mostly see a continuation of the volatile, unpredictable market we have seen in this last week.

Rapeseed harvest in central and southern Europe is largely completed and yields are generally better than expected.  This, combined with the sharp rally in the Euro/US dollar, has pushed the European rapeseed futures down to two-week lows.

In the UK, the harvest is now well underway and the anecdotal reports to date suggest yields are around 0.5t/acre better than last year.  For those growers who need movement, Gleadell has a network of store and port facilities, and some market leading storage deals.  Please contact your farm trader for more detail.

Oats

Early reports of new crop oats being cut in the south and east of England point towards decent yields and quality. However, not enough has been cut to determine overall quality and yield for the crop.  Furthermore, current rains will have hampered progress and the market looks to see what effect this will have.

There are still old crop parcels in the market and, with new crop harvest imminent/commencing, indicated values remain depressed.  Consequently, farmer selling remains light as they wait to assess their crop quality before committing tonnages at these current levels.

Pulses

Whilst the UK is competitively priced into Egypt against old crop Australian and new crop Baltic beans, demand is slow, as large vessels have arrived in Egypt from Australia over the last few weeks.  This should keep the domestic market well stocked for the next few months.

The first large blue peas have been cut in Cambridgeshire and Sussex this week. Yields are average, but the quality looks good.  There have been some reports that pea crops were damaged in East Anglia in the thunderstorms in the early part of this week, and all eyes will be on the weather forecast over the next few weeks to see how quality is affected.

Seed

Clearfield varieties are proving to be very popular with growers this year, as they can help to control broad leaved weeds, remove volunteer OSR, and improve establishment vigour.  This is due to Clearfield varieties being tolerant of SU residues in the soil, which may be present from previous crop herbicides.  DK Imperial CL, from DEKALB, is set to sell out again this year.  Imperial features pod shatter resistance and vigorous establishment.  Veritas CL and Phoenix CL are both offerings from breeder DSV.  Veritas is a robust and healthy variety that has strong youth development before winter.  Phoenix has outstanding autumn vigour and very good tolerance to drought.

Hybrid barley variety Bazooka remains to be in short supply.  Sunningdale is a quality alternative that remains available in higher volumes.  Sunningdale is good in the north, but also performs very well on lighter soils.  Hybrid barleys’ early maturity makes for an excellent entry for OSR and for spreading workload.  Their disease resistance profile is solid, reducing risk, and it has also been shown that their competitiveness can help with blackgrass suppression.  Also, from the harvest samples we have seen so far, the spec weights have been some of the best.

Hardwicke is a stiff-strawed winter wheat variety that could be beneficial in some growers portfolios for harvest 2018 if they have suffered from flat wheat crops this year.  Hardwicke is a group 4 soft and was the shortest, stiffest variety added to the RL last year.  Although recommended for the northern region, it will certainly find a place further south, particularly with growers who have been growing the likes of Alchemy and Leeds.

Fertiliser

Nitrogen

In recent weeks, granular urea came within a few dollars of previous floor levels. However, markets have firmed again by more than $20/t over the past 10 days.  At the end of last week India announced a tender, closing today, and is expected to buy some 500,000t, helping to reduce the risk of any build-up in stocks.  Whilst UK values followed suit, the improved £/$ rate means that the higher replacement costs haven’t impacted on prices as much.  Ammonium nitrate markets across Europe remain firm, despite demand quietening with harvest is now well underway for most.  AN imports remain uncompetitive as levels on the continent remain higher than the UK.  Therefore, CF is likely to continue to track the European market, and we may see modest price gains over the next month.

PK

Demand for PKs and straights remains low and prices are being squeezed as blenders compete for limited business.  The first loads of Fibrophos and P-Grow are beginning to be delivered this week and spread onto barley stubbles.  P-Grow (0-23-0) offers phosphate on a p/kg basis at half the price of TSP.  With variable rate spreading also available, P-Grow can be considered by anyone looking at maintaining current P indices this autumn.

ALZON® neo-N: Security whatever the weather!

THE WORLDS FIRST fertiliser product with integrated nitrification and urease inhibitor.  Brought to you by Gleadell, ALZON® neo-N is a brand-new product from SKW Piesteritz that guarantees consistent high quality and excellent spreading to wider widths.  The new urease inhibitor (2-NPT) greatly reduces the risk of volatilisation and in trials can boast reducing ammonia losses almost completely.  The nitrification inhibitor (MPA) gives a sustained release of nitrate for up to 14 weeks and has been shown in trials to reduce nitrogen losses due to leaching by almost 50% and losses due to denitrification by more than 50%.

£/€ £/$ €/$
1.1245 1.294 1.151
Feed Barley £ Feed Wheat £ Beans £ Oilseed Rape £
Jul17 107.00-115.00 138.00-150.00 185.00 305.00-310.00
Nov17 120.00-128.00 135.00-145.00 165.00 314.00-319.00
NB: Prices listed may vary depending on area.

NB: Prices quoted are indicative only at the time of going to press and subject to location and quality.

“Although Gleadell take steps to ensure the validity of all information contained within the Gleadell Market Report , it makes no warranty as to the accuracy or completeness of such information. Gleadell will have no liability or responsibility for the information or any action or failure to act based upon such information.”

Gleadell Agriculture cannot accept liability arising from errors or omissions in this publication.

Gleadell trade under AIC contracts which incorporate the arbitration clause.

Terms and Conditions of Purchase.

On every occasion, without exception, grain and pulses will be bought by incorporating by reference the terms & conditions of the AIC No.1 Grain and Peas or Beans contract applicable on the date of the transaction. Also, we will always, and without exception, buy oilseed rape and linseed by incorporating by reference the terms & conditions of the respective terms of the FOSFA 26A and the FOSFA 9A contracts applicable on the date of the transaction. It is a condition of all such transactions that the seller is deemed to know, accept and understand the terms and conditions of each of the above contracts.

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