Important updates and advice regarding coronavirus (Covid-19)

Mid-week market report - 20th February 2019

mw_20190220-154702_1

Global markets weaken

World wheat markets started notably weaker this week, led lower by the US CBOT wheat futures that dropped to a 13-month low yesterday.

The US is failing to secure sufficient trade to help them meet export targets and they need to be more competitive. This was highlighted by recent tenders where both Syria and Bangladesh opted for Black Sea wheat buying 200,000 tonnes and 50,000 tonnes respectively.

French wheat futures followed and fell to prices not seen since July despite an improvement in the EU export pace. Markets are also noting upbeat estimates for 2019 wheat production. One optimistic analysis saw Russia potentially reaching 80 million tonnes which would be their second ever largest wheat crop.

However, recounting last season's experience of prolonged dry hot spring weather there can be a big difference between expectation and reality. The unusual current dry spell is extensive across Europe and North Africa and is of some concern. Temperatures will be notably higher than average which has been indicated by those in Spain where it is expected to reach 25°C this week.

London futures weaken, but physical prices remain strong

Domestically, London futures have also been weaker which has not been helped by firmer sterling although physical wheat prices have remained strong. This is partly due to farmer retention but there are concerns about overall wheat availability with significant differences between the cropped area in the Defra crop survey and the recently released basic payment scheme statistics that point to an extremely tight balance sheet.

Frontrunner - 22nd February 2019
Frontrunner - 15th February 2019

Related Posts

 

Comments

No comments made yet. Be the first to submit a comment
Already Registered? Login Here
Guest
Thursday, 13 August 2020

Captcha Image

We use cookies to improve our website and your experience when using it. Cookies used for the essential operation of the site have already been set. To find out more about the cookies we use and how to delete them, see our Cookie Policy.

OK