International Grain, Seed and Fertiliser Merchant

Market Report

Thursday 16 November 2017

Feed Wheat

US markets have remained in their downward spiral as spill-over selling following the bearish USDA report continues.  Chicago corn has recently traded at contract lows, although pressure may ease as farmer selling slows, with harvest nearing completion.  US wheat continues to test the recently-set contract low and, with only routine export trade being registered, it is likely that this next target will be breached.  Fund managers continue to extend their short position, seeming more than comfortable with current market dynamics and US crop prospects.

EU prices have eased on the week, trading down €1/t as slow exports, falling Russian export prices and a weaker US$ continue to weigh on values.  The main talking point this week has been the court ruling in Egypt reinstating the zero tolerance of ergot contamination in wheat imports.  It will be of interest in today’s tender what the reinstating of the zero tolerance, and confusion over Egypt’s intake criteria, actually means in US$ terms.  Offers, if there are any, will carry a level of protectionism against the risk of increased costs imposed on shippers.

UK futures have also eased, down £2/t on the week, although there has been little change in physical prices, especially in the nearby positions.  Reports that one of the country’s ethanol plants has brought forward its annual maintenance shutdown, and indicated a prolonged time period, has the trade talking of spot prices easing due to lower demand.

UK wheat exports rose in September to 75,284t, down 78% y/y, and although imports for the same period were reported at 419,093t, down just 2% y/y, this still leaves the UK supply and demand forecast very much in balance.

In summary, the US markets are looking to retest market lows along with the Matif.  Egypt has thrown confusion into the market with its now unclear import policy and will only mean they paid higher prices, and market dynamics in the UK show little signs of easing.  Funds continue to extend their short position, and current market fundamentals give little evidence why they should change their current stance, except to bank profit!

Malting Barley

Markets for unsold 17/18 malting barley are predominantly in the new year as pre-Christmas positions have mostly been fulfilled.  Lower nitrogen varieties are sought after due to the lack of supply from this year’s crop and premiums are firm.

The 18/19 market continues to disconnect from the 17/18 market and prices are weakening following the forecasts of a greater EU spring barley area next year.

Gleadell can offer contracts for most varieties for 18/19, including the most popular springs Propino, RGT Planet and Laureate, and also the newer varieties, Chanson and Diablo.

Rapeseed

Following last week’s neutral/bearish USDA report for soybeans, fund managers have been aggressive sellers, pushing CBOT soybeans down £6.50 on the week.  This negativity has been added to by a sharp improvement in production prospects in Brazil, with some commentators pushing their estimates as high as 108mln t.

In Europe the Matif rapeseed complex has followed the slide in CBOT closing €8.25 down.  The firming euro/US$ has also contributed to the declines in the euro-denominated rapeseed futures market, but that currency’s rally vs. sterling has helped cushioned UK farmgate prices, and our domestic values remain largely unchanged.

The market continues to be buffeted by the volatility in the foreign exchange markets.  Crops around the world appear to be developing without issue.  European rapeseed plantings appear to be well established and we really need a crop problem or some fresh bullish news to push prices higher from here.

Pulses

Now the rules have changed to allow no pesticide products to be applied on pulse crops in an EFA, we would urge growers to look for a variety with as clean agronomic package as possible.  For this reason, we would urge growers to look into Lynx and Vertigo as the best combinations of yield and agronomics.

Gleadell has decent supplies of large blue and marrowfat pea seed.  Please contact your Gleadell farm trader to discuss contract options to enable a decision on variety to be made based on contract availability.

Seed

Spring seed has been in high demand over the last fortnight as growers are nearing the end of the winter cereal drilling campaign, apart from fields after root crops and sugar beet etc., still left to lift.

Spring Barley

Malting variety Laureate is now sold out, which will put pressure on RGT Planet and Propino stocks next, as growers look to take what contracts are still available for crop ’18.

For growers looking at feed barleys, KWS Irina and RGT Planet look the best options available.  Although malting types, they have very high yield potential and RGT Planet has a competitive spring growth habit to get on top of grassweeds, while KWS Irina is very short and stiff to suit growers where lodging has been an issue.

Spring Wheat

The two new spring wheat varieties, KWS Chilham and KWS Cochise, have been in high demand, and are therefore very tight in supply.  Gleadell has limited stocks of these two varieties available, and once they’re gone there is no more, so requirements need covering ASAP.

Mulika is still in good supply. However, it  is now 10% lower yielding than KWS Cochise.

Belepi is still available from now all the way through to spring for anybody wanting a soft endosperm, late autumn/very early spring-drilled variety to blend in with Group 4 soft winter varieties in the store.

Spring Pulses

Now the rules have changed to allow no pesticide products to be applied on pulse crops in an EFA, we would urge growers to look for a variety with as clean agronomic package as possible. For this reason, we would urge growers to look into Lynx and Vertigo as the best combinations of yield and agronomics.

Gleadell has decent supplies of large blue and marrowfat pea seed.  Please contact your Gleadell farm trader to discuss contract options to enable a decision on variety to be made based on contract availability.

Fertiliser

Granula Urea

After the latest Indian tender was scrapped, producers have been left with November stocks which will need selling.  This has meant that cracks have started to appear in what has been an inactive market and this may see some sellers inclined to accept lower offers in order to move stock.  India will need to tender again for circa 800,000t in December and Chinese production remains low as high coal prices continue and exports are significantly lower year on year.  The US, European and Turkish markets all remain short of urea for the spring and need to buy substantial quantities come January/February.

Ammonium Nitrate

AN markets are slow in the UK after CF posted another increase to both straight nitrogen and nitrogen/sulphurs last week.  Levels still represent excellent value compared to European markets, where 33.5% is offered at an equivalent to £260/t.  Imported AN is trading at a slight discount to UK which was purchased earlier in the year.

NPK

Phosphate markets continue to climb higher with most recent trades up another $20 over the week.  Blenders have withdrawn NPK/PK and straight prices this week and reissued higher numbers to represent this move.  Prices for TSP and DAP are up by another £5/t today, with further increases planned for next week.  Whilst demand has remained steady for PK and NPKs, the spiraling raw material costs will push up both blends and CF compounds.

£/€ £/$ €/$
1.121 1.319 1.176
Feed Barley £ Feed Wheat £ Beans £ Oilseed Rape £
Nov17 121.00-129.00 131.00-143.00 149.00 323.00-328.00
May18 125.00-135.00 137.00-149.00 155.00 329.00-334.00
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.

Latest Tweets

Follow Us

Get updates

Registered Office:
Lindsey House, Hemswell Cliff,
Gainsborough, Lincolnshire DN21 5TH.

Company Number: 534118