WHEAT 

• Volatile foreign exchange markets provide a small price boost 

Following confirmation of the trade agreement between the US and the EU, there was a sharp decline in the value of the euro in foreign exchange markets on Monday this week. The euro lost 1.25% against the US dollar and Paris wheat futures gained €3.  

The weaker euro should help EU wheat become more competitive in world markets, boost wheat export hopes and address the dire performance for the new season to date. For the week ending 27th July, just 294,000 tonnes of EU wheat was shipped taking the total for the first month of the new season to 803,000 tonnes. However, this compares badly with last season when in the same period 2.249 million tonnes was shipped. Worse still, the EU wheat exportable surplus will be notably larger by 32 million tonnes this season, compared with less than 2 million tonnes last season.  

The trade data provided some market positivity around corn imports. The EU has bought in just 555,000 tonnes so far, well below last year’s 2.1 million tonnes in the same period. Wheat might find a domestic demand boost if it is cheap enough to displace corn in the EU feed ration. 

The poor EU wheat export data saw Paris wheat futures subsequently lose all the gains made on Monday. 

• Mixed harvest results so far 

The Northern Hemisphere wheat harvest progresses with mixed fortunes. The US weekly crop progress report put winter wheat harvest seven points up on the week to 80% complete. Spring wheat condition slipped 3 points lower to 49% good/excellent and is well below the 74% seen last year. Only 1% of the spring wheat was harvested.  

In Russia, a delay in rain for the harvest has seen spot prices remain firm, attracting farmer selling to meet waiting vessels. Despite the delayed start to harvest, the Russian agriculture minister, Oksana Lut, said Russian farmers had harvested 50 million tonnes of grain. Analysts at SovEcon increased the Russian wheat export estimate from 38.3 million tonnes previously to 43.3 million tonnes.  

Ukraine is off to a slow start to its wheat export programme, having shipped 487,000 tonnes so far this month - a third of last year's 1.44 million tonnes at this time. Both Germany and Poland are suffering rain delays for wheat harvesting and have quality concerns.  

On the contrary, UK farmers have experienced fewer rain events, and the wheat harvest is now progressing northwards with improving yields reported. Light land in the Southeast has suffered from some yield losses on the year of up to 25%, whilst some in the Northeast are seeing yields on a par or up on the year. Generally, quality has been maintained, with Group 1 proteins above the minimum 13% threshold on average and Hagberg numbers above 300. However, there are some exceptions in the Southeast corner of the UK where Hagberg numbers below 180 have been seen. 

• Improving Southern Hemisphere prospects 

July rains have improved wheat production prospects for Australia. In early June, the Australian Department of Agriculture, Fisheries and Forestry saw potential for only 30.6 million tonnes and the United States Department of Agriculture (USDA) put the 2025-26 crop at 31 million tonnes.  

Traders now see a possibility for the wheat crop to reach 33 million tonnes, which would add weight to already ample global supplies and that continues to weigh on wheat prices. The Australian weather bureau sees above average rain over the next three months adding to the optimistic outlook. Partly as a result of favourable weather in recent years, the average crop for the five years to 2024 was 33.8 million tonnes, whereas the five years before that averaged 21.4 million tonnes. 

BARLEY 

The harvest pressure of winter feed barley movement has mostly subsided in England. Domestic feed barley demand between around £15-20/t below feed wheat (depending on geography) will limit further feed barley export sales at current levels.  

Spring malting barley harvest is underway, however, progress has been slowed in the last week due to the weather. We estimate that harvest progress in England is around 15% complete, with early indications of both yield and quality being mixed. Moisture levels, screenings and skinning levels are all low, germinations to date have been reasonable and the presence of ergot appears to be less than last year. Nitrogen levels, however, are trending high, and to date we are seeing a failure rate (mostly due to nitrogen) of around 25%. It should be noted that many pre-harvest malting barley supply and demand would have estimated a higher failure rate than this, and the well-publicised issues with malting barley demand and large carry in stocks of crop ‘24 malting barley remain. UK maltsters remain relaxed and remain mostly absent from the market. 

Feed barley values will be highly impacted by the failure rate of the spring malting barley that remains to be harvested. As more malting barley fails, this will put more of the crop in the feed pile and ultimately pressurise prices. 

OILSEEDS 

Movements in the rapeseed market have been turbulent over the past week as rains across Europe have limited harvest progress which, in certain areas, has limited availability of nearby seed supply. This has given some nearby support to prices, although this could quickly dissipate when harvest progress continues and more of the 20+ million tonnes of European crop becomes available to crushers. Ukraine is also uncharacteristically behind Europe in its harvest progress, further limiting the availability of seed on the continent.   

Across the UK, rapeseed yield and oil reports have been positive, with record yields coming from some farms, no doubt thanks to increased levels of sunlight during key growing periods. This positivity is flowing through to new crop, where it feels like the current intention is to increase plantings due to good moisture in the seedbed and strong prices.   

In the US, there is optimism about the size of the soybean crop accompanied by concerns that the demand may not be able to keep up. We have seen Chicago soybean futures decline consecutively for the last seven days, which will eventually have a weighing effect on the wider oilseeds complex. One of the biggest concerns for market prices over the next year is an abundance of oilmeals, which have been and continue to be generated due to decent oil margins. With them being so plentiful, it may start to bring crushing margins lower, which could in turn lower the seed price as crushers struggle to offload stocks. There are already reports that European rapemeal is getting so cheap, it's now a commercially viable option for use in biogas plants. 

FERTILISER 

• Urea/AN 

Over the last few weeks, we have referenced the supply situation with regards to AN and urea. At this time of the year, we would normally have more product than demand, but this is certainly not the case in summer 2025. If you need to buy AN or urea now is the time - don’t wait until AN goes over £400/t or India buys more urea. 

Current UK ammonium nitrate offers are below £400/t for delivery and pay later. Even though this is an increase over the June offer, it is still a good purchase price and reduces the risk of no supply or having to change nutrition options in spring 2026. CF Fertilisers is already talking about logistical issues over Christmas, which will reduce available tonnes to the market and before we know it supply will be restricted again as it was last spring. Alternative imported AN offers are not available for that forward period, a signal that the European producers don’t want to import into the UK market unless producer margins improve to well over £400/t.  

The recent urea production trouble within the Middle East has related to energy supply, which is linked to global geopolitical concerns and hence a very high-risk strategy. Reducing the gas supply from the urea producers in Egypt has already meant a loss of thousands of tonnes of urea. Overall, this year’s outages in world urea production have taken over 10 million tonnes off the market already. India is very aware of the supply issues and is back in the market again to buy more.  

The current situation in India is that urea production is down compared to last year from April to June. Sales are up and imports are down versus the same period the year before. This would be fine if there was a surplus, but that is also behind by over 1.5 million tonnes, leaving no options other than to come back into a market that is very firm. The latest Indian tender was announced last Thursday for shipment by 22nd September, with the country once again targeting 2 million tonnes. This will keep the market firm for the next two to three months, by which time any lower summer energy cost advantages are gone. 

• Liquid/UAN 

There is an increase in demand for oilseed rape starter fertiliser options - both NPs and NPKs –  a spike that has come in recent days following moisture from ongoing, unsettled conditions across some parts of the UK. This, combined with available stubbles following earlier harvest progress, has led to many growers looking to establish the crop.  

Products in either bulk or IBCs are available for prompt delivery to meet demand from farm, as are bulk UAN loads for forage crops where there is a requirement for spot delivery. It is suggested that growers with a spot demand contact their local Frontier representative to discuss the various options available.  

Elsewhere, terms remain largely POA on nitrogen and nitrogen sulphur UAN grades for delivery in both the autumn tank fill and spring periods. Volumes for spring delivery are expected to remain in the POA position in the short term as UK shippers manage their available stocks and vessel commitments. 

• Straights/PKs 

We are seeing some limited demand for DAP and DAP mixes for oilseed rape establishment. As the wheat harvest continues before the next rain shower, focus will turn to autumn MOP and TSP grades to improve and maintain current indexes. It is certainly worth taking a few minutes to get an update on current values. World supply is in few hands when we look at phosphates, so it is wise to stay close to current offers via your Frontier contact. 

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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