WHEAT

• Markets continue to fall

The world’s wheat futures markets continued to fall this week, with most setting new contract lows. The global wheat supply is growing larger, with production estimates for the world’s major wheat producers continually revised higher. The latest increase is for Argentina, who’s 2025/2026 wheat crop was estimated to be at 24 million tonnes by the United States Department of Agriculture (USDA) earlier this month, compared to 18.5 million tonnes last year. This week, however, the Rosario Grains Exchange said Argentine wheat production would reach a record 27.7 million tonnes, almost a 50% increase on the year. With Argentina now the cheapest seller of world wheat, a 65,000 tonne vessel loaded with milling wheat set sail to China, marking the first sale of Argentine wheat to the country. Futures found that additional selling pressure came from rumours that China had cancelled sales of US wheat. The additional Argentinian crop takes the total 2025/ 2026 world wheat production estimate to 40 million tonnes, leaving short term price recovery challenging.

• Optimism amid Russia Ukraine peace deal

With an optimistic view for a potential cease fire between Russia and Ukraine, traders saw another negative element impacting wheat prices this week. Ukraine’s wheat exports this season have only reached about 7.5 million tonnes compared to 9.2 million tonnes this time last year, in part due to increased Russian attacks on Ukrainian Black Sea ports. The Public Ukrainian Railway company, or Ukrzaliznytsia, said Russia had attacked the port of Pivdennyi in the Odessa region as well as rail infrastructure that serves the port. If this had happened earlier in the war, wheat futures markets would have rallied sharply as a result, given that Ukrainian wheat is key to the world market’s supply. However, because there is a supply of wheat from other major world wheat exporters this season, futures markets have registered no positive reaction to restricted trade from Ukraine.

• US wheat exports maintain a strong pace

The US government shut down this autumn left official US trade data unavailable. But now the USDA is catching up on its data, it shows positive progress for US wheat exporters. Wheat sales for the week of 20th November came in at 363,000 tones, taking the total sold to 18.479 million tonnes, 23% up on the year and closing in on the USDA predicted total for the season at 24.49 million tonnes. US weekly wheat export inspections for the week of 11th Dec were 488,000 tonnes towards the top end of trade expectations, taking the total to 14.125 million tonnes, 22% ahead of last year. With 10 million tonnes still to ship, US wheat prices have fallen to ensure US wheat can continue to maintain a competitive edge.

BARLEY

• Consumers step back while limited export interest returns

Export interest has returned in the last week, although in limited volumes. While the interest is there, high freight costs and offer levels from competing origins are keeping bid values for UK barley suppressed. Domestically, consumers continue to be bystanders in the current feed market as they make decisions over demand and barley’s place in feed rations. In most of England, feed barley’s discount to wheat has narrowed to just £10, whereas in the Southwest, the discount is even tighter than that. At these levels, feed barley demand should suffer on paper. But demand up until now has been healthy amid strong livestock markets, despite weakening dairy markets.

• New crop markets quiet

All new crop barley markets are currently suffering from a lack of liquidity. Malting buyers are re-evaluating and gaining clarity on the demand landscape going forward before acting, whereas farmers are unlikely to sell a forward price on quality barley today.  feed barley growers and consumers are similarly disengaged. The Agriculture and Horticulture Development Bord (AHDB) reported in its November early bird planting survey that the UK barley area would be reduced by over 10% compared to last year, the smallest since 2010. New crop feed barley is only selling at a £12 discount compared to wheat based on a smaller crop – but at this stage a discount at that level will do little to motivate consumers to come out and take forward cover for crop ‘26 just yet.

OILSEEDS

Global rapeseed markets showed mixed trends last week, with underlying price dynamics influenced by broader oilseed sentiment and regional supply constraints. Paris MATIF rapeseed futures continued to soften in line with broader weakness in global oilseed markets. Canadian Canola futures seem to be the main loser due to its record crop size announced last week, as export demand to China and the US remain weaker than last year.

UK domestic rapeseed prices for early December have remained stable and are well into the £400’s ex-farm in England. Nearby demand from crushers has helped prop up values, with continually challenging logistics on imported rapeseed. Prices for harvest 2026 are trading at slightly lower levels in relation to old crop values as it looks more likely there will be a large carryover of seed.

Fundamental drivers underpinning this mixed price behaviour are the ample global stocks across key oilseeds (including a record global oilseed crop of 85 million tonnes), mixed direction in related vegetable oil markets, challenges around logistics, and placement of GM and non-GM seeds, which can only be used in certain European supply chains.

FERTILISER

• Urea/AN

International markets have kick started into action after a subdued period, with European and UK activity being concluded in anticipation of the European Carbon Border Adjustment Mechanism (CBAM) implementation on 1st January. North African producers are connecting with South American interest and exports into the US market are increasing, offering them a good opportunity to fill their orderbooks. A further tender from India for 1.5million tonnes for February shipment will add some much-needed positivity for producers. Latest sales have seen a recovery of $15 to $20 from recent lows.

Ammonia costs have stabilised but remain high. The outlook for ammonium nitrate values are stable given lower domestic availability and lower imports coming into the UK. It is thought that there is still 40% of the UK nitrates market to still be purchased.

• Liquid/UAN

Frontier continues to offer both UAN and NPKs for spring delivery. Given the firmer sentiment on urea and AN solid values, liquid offers a competitive approach for those still looking to buy and we would advise that any product still to cover is bought soon. We have also seen a lot of interest in liquid NPs and NPKs, mainly in the vegetable and potato markets. However, it’s also worth considering for cereal and grassland farms, especially where farm hardware, such as sprayers, has capacity.

• Straights/PKs

Phosphates look to have a found a floor and new shipments are focused on a January and February delivery schedule. Potash markets are still relatively soft, but keep in mind delivery windows and the delays witnessed last season are a reminder of the importance of getting product delivered in a timely fashion.

Crops in general are looking good across the UK. With rainfall over the autumn being well above average in certain geographies, fields and low P and K indices will need an earlier application to keep plant development on course. Please speak to your local Frontier representative for more information.

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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