WHEAT

• US corn pushes wheat lower again

Wheat prices tumbled lower again this week with the Chicago Board of Trade (CBOT), Paris and London futures all dropping to new contract lows again. They were pushed down by a particularly bearish corn update from the United States Department of Agriculture (USDA), even though changes for the wheat balance sheet were no worse than neutral. 

In its August update, the World Agricultural Supply and Demands Estimates (WASDE) report included a higher-than-expected US corn yield, adding over 25 million tonnes to the previous estimate. CBOT corn lost 13 cents after the report, setting a new contract low with the December ‘25 position and dropping below $4. 

The US harvested area is seen rising from 86.8 million acres to 88.7 million acres, and the yield from 181 bushels per acre to 188.8. The combined increases lift US corn production to 425.26 million tonnes from 398.93 previously. Looking for positives, the USDA sees world corn consumption up 13.5 million tonnes on last month to 1.289 billion tonnes, and world stocks up only 10.5 million tonnes on last month to 282.54 million tonnes, which is still 600,000 tonnes below the carry in figure to this season. 

For the world wheat balance sheet there was no drama. Argentina production was marked down 300,000 tonnes to 19.7 million tonnes, when all the recent reports quote a bigger area and higher yield prospect. Ukraine was left unchanged and arguably too high at 22 million tonnes, and China was marked back 2 million tonnes to 140 million tonnes. The EU production increased by 1 million tonnes, reflecting changes from others recently.  The modest differences leave end stocks down 1.5 million tonnes on last month at 260.1 million tonnes, which is 2.7 million tonnes down on the year. 

• Plenty of Russian wheat 

The USDA left its Russian wheat production estimate untouched from the previous month at 83.5 million tonnes, whilst others continue to make changes. Analysists from Sovecon are more upbeat in their estimates, moving from 83.3 million tonnes to 85.2 million tonnes.  

The Institute for Agricultural Market Studies (IKAR) increased its estimate to 84.5 million tonnes, up from 500,000 tonnes previously, with higher yields being seen in the central regions as harvest progresses. IKAR also increased its Russian wheat export estimate by the same 500,000 tonnes, to a total of 41.5 million tonnes. With the widespread view that the Russian crop is now in the mid-80-million-tonnes region, there will again be strong competition in export markets all season. Russian wheat prices were up the end of last week at $239 FOB early September for 12.5% protein milling wheat. Wheat shipments are expected to be up to 3.5 million tonnes in August - almost double the July volume at 1.8 million tonnes. Harvest progress has passed 40% of the cropped area, but rain forecast for the next two weeks in central Russia might delay this and spoil quality. 

• UK view 

The USDA listed the UK in its WASDE, but it clearly hasn’t given much thought to changes in our balance sheet since last month.

The crop estimate looks high at 12.5 million tonnes, the consumption high at 15.5 million tonnes, and it sees 3.2 million tonnes of imports which is unlikely to happen.

The Agriculture and Horticulture Development Board (AHDB) said in a report that the UK wheat harvest was 48% complete as of 6th August, compared to 37% last year and 31% on average. A week on from this and in South Lincolnshire there cannot be more than 10% left to be to cut. The AHDB sees average yields so far at 7.66 t/ha, 1% below the five-year average but 5.2% higher than 2024. They also noted significant regional differences. However, from the East coast through to the Cotswolds, farmers are reporting significantly greater yield losses - up to 20% below the average for some. Those achieving above this are notably few so far.

From a demand point of view, a reduced need for bioethanol production will see final numbers well below the USDA estimate. Currently London futures are trading close to parity with the Paris market. Prices are poor but would be perhaps £15/t less in a traditional surplus year when exports are needed.

BARLEY

• English feed barley values remain steady in the nearby months

Compounder and merchant shorts have had to ignore the drop in wheat futures markets if they want to secure supplies of feed barley for August and September. However, they will not pay much of a carry for October onwards, as they will perceive both wheat and barley sellers will have to become more active for these months eventually. Farmers with a cash requirement this side of Christmas might as well have their money now by spot selling compared to later.

• Record US maize production drops world feed grain markets

With the US maize area being the second highest in 90 years and a record corn yield being suggested, the world and the EU have an ample supply of feed grains. This will be a dead weight on the UK feed grains market as well. English barley values look overpriced when compared with wheat values and so it may struggle to maintain its place in the animal feed ration. Malting barley failures, due to high nitrogen in England and high screenings in Scotland, are adding to supply as well. The discount to wheat today in England is one of the smallest in the last two years. Growers are advised to be selling feed barley or fixing bases on malting barley contracts and holding wheat.

• Malting barley quality has challenges but supply present

As mentioned, failures are occurring in England due to high nitrogen and in Scotland due to high screenings levels. However, the dry harvest means there are no germination issues to speak of and no drying losses of note. Maltsters are in the process of working out their raw material needs in the face of lower demand for their malt and a record tonnage carried from crop ‘24 into the 2025/26 production year.

OILSEEDS

The UK harvest has almost come to an end, and the overall picture is more positive than expected. Despite a 25% reduction in planted area compared to last year, yields have been strong enough to suggest that the total crop size may even surpass last year’s.

On the bearish side, the major development this week is China’s decision to reimpose tariffs on Canadian rapeseed, reversing earlier hopes that they might be lifted. This move frees up Canadian supply to enter Europe, potentially displacing other origins. However, a key limitation remains: Canadian rapeseed is genetically modified, which restricts its use in European food markets and therefore caps potential volumes.

In parallel, the European harvest is nearing completion, with yields across the continent exceeding expectations. Sunflower seed crops are also performing strongly, soybean supply and demand remains balanced, and oil meal markets are weighed down by significant global stocks, keeping crushing margins under pressure.

Bullish factors include a slightly more negative outlook for the US soybean crop, as reported in the USDA update on Tuesday 12th August. Strong demand for vegetable oils continues to underpin prices, and any reversal of China’s tariff policy could rapidly restore traditional trade flows, though current uncertainty is keeping markets cautious.

Looking ahead, the size of Canadian and Australian crops will play a pivotal role in shaping global rapeseed pricing. Market expectations currently point towards weaker yields in both countries, which could provide price support. For now, rapeseed’s fortunes remain hard to predict but political interventions and trade realignments will continue to inject volatility into the months ahead.

PULSES

• Feed beans

The Baltic harvest continues to be delayed due to rains, especially when compared to the UK, where most beans will be harvested within the next 10 days. UK feed beans are currently competing with export out of Germany, which has traded around £10/t cheaper than where UK is offered.

There are several spot FOB buyers in the market, which will trade as beans come available. This means that we will likely see the early export programme that we missed last year.

Domestically, there is some spot interest but nothing further out. These shorts will fill up quickly as people look to move available beans, causing the market to move downwards.

Given the continued lack of domestic demand, beans will have to discount themselves for export.

• Human consumption beans

Winter beans look good this year and sellers with good quality beans can expect to make at least a £15 to £20/t premium over feed beans.

The consensus is that spring beans have been a failure in the UK, with a very small yield. It’s unlikely the UK will export many of its spring beans to Egypt this year.

The Australian crop quality is unknown, but buyers will soon turn to these when they can. The UK should take advantage of this early market.

FERTILISER

• Urea/AN

Urea markets continue to remain buoyant, given India has purchased 2 million tonnes of its August to September requirements. The Indian market has become the benchmark for global values and, as a premium market, suppliers are consistently eager to fulfil its purchasing needs. Attention will now focus on what additional tonnes they require to commit to, as well as autumn purchasing into Europe and South America in particular. FOB prices out of Egypt and Algeria have firmed this past week, leading to higher offers in the EU and the UK.

As mentioned on previous market reports, global production has been set back 10 million tonnes, making any significant downside in prices unlikely.

Ammonia has risen $160/t since the start of June, whilst AN pricing has not fully reflected these gains. Availability remains tight within the UK and Imports from Europe will be scarce as European domestic markets are more likely to keep product at home. Frontier still has December availability for UK-made AN sub-£400, so there is still a good opportunity to secure spring requirements at affordable levels. Our view is that this market will firm over August and September, given the high costs of feedstocks for producing ammonium nitrate and the likelihood of lower production over the winter.

• Liquid/UAN

Deliveries continue to occur for summer tank fill at values which now look well priced. Pricing remains ‘price on application’ for summer and autumn fill and we would advise that you contact your local Frontier representative if you still have capacity to take. Growers are reminded that any UAN-containing products, including NP starter fertilisers, that are broadcast applied this summer for oilseed rape establishment or post-cutting on grassland, must contain a urease inhibitor, such as Limus Perform, to remain compliant with the Urea Stewardship Scheme.

• Straights/PKs

Tight supplies on straights have returned to the UK, with stocks at stores around the country low and awaiting new shipments from abroad. Sentiment remains firm on phosphates driven by higher ammonia costs built into Di ammonium phosphate values and lower exports from East Asia, which in turn will lead to higher costs for TSP imports. Potash for the meantime remains stable to firm, with the upside likely to occur once we see late autumn and spring requirements ordered. It is important to acknowledge that straights values are not only influenced by supply and demand, but the importance of trade tariffs now being introduced especially linked to Russian and Belorussian product. These are effectively setting a floor on values and given the UK Government’s stance on sanctions, it limits where we can buy raw materials from, driving values higher but also reducing timely shipments.

With cropping plans now in sharp focus, our advice would be to start considering covering a percentage of next season’s required tonnes to ensure you have product in stock and help prevent delays of deliveries similar to last season.

Please speak to your local Frontier contact or email us at info@frontierag.co.uk for more information or advice related to any of the topics and services mentioned in this report.

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