WHEAT

Escalating tensions in the Black Sea region are driving wheat markets higher, with news of potential intensified Russian missile strikes on Kyiv causing significant disruption to export flows. The Black Sea, which typically accounts for 70% of Russian grain exports, has seen grain loadings virtually halted due to attacks between Russia and Ukraine. Repair works at NKHP, one of Russia's key Black Sea terminals, are expected to last up to four months following recent damage. This uncertainty over global grain availability has pushed Chicago wheat futures to the daily limit, with December soft red winter wheat closing at $7.48 and a quarter per bushel, marking fresh multi-year highs. European markets have also reacted, with Euronext December wheat hitting €246.25/mt, it’s highest since late July.

Crop conditions in the US are adding further bullish sentiment to the market. The United States Department of Agriculture’s (USDA) latest ratings show that only 57% of the US corn crop is in ‘good/excellent’ condition, down from 60% last week and well below expectations. Meanwhile, spring wheat conditions have deteriorated slightly, with 51% rated ‘good/excellent’, down from 52% last week. The US spring wheat harvest is now 62% complete, ahead of the five-year average. Poor US crop performance, combined with results from a Midwest crop tour projecting lower-than-expected yields, has strengthened corn and wheat prices further. Corn futures rose to $5.36 and a half per bushel, their highest since July 2023 on spillover strength from wheat.

Price movements across major wheat contracts show solid gains. Chicago Board of Trade (CBOT) December soft red winter wheat surged 45 cents, while Kansas City December hard red winter wheat climbed 38 cents to $8.08 and three quarters per bushel. Minneapolis December spring wheat gained 28 cents to $7.48 per bushel. European markets tracked closely, with Paris milling wheat futures up 4%, reflecting the global tightness in supply and shifting demand away from the Black Sea region. France is now set to load two vessels with 60,000mt of wheat for Egypt, a significant shift in trade flows for the world's largest wheat importer, which sourced over 80% of its wheat from Russia and Ukraine earlier this year.

The disruption in Black Sea exports is prompting buyers to diversify their sourcing strategies. Egypt, Bangladesh, and Sudan are turning to European and alternative suppliers such as France, Bulgaria and Romania. Physical premiums for European wheat have risen, with French and Russian wheat quoted around $271-$274/mt FOB, while Russian and Ukrainian wheat remain heavily discounted at $207-$212/mt FOB. However, the logistical challenges in the Black Sea and narrowing diplomatic avenues are keeping the market volatile.

Looking ahead, the market remains focused on geopolitical developments in the Black Sea and US crop progress reports. With repair works in Novorossiysk likely to stretch into the year-end and no signs of easing tensions in the region, the bullish momentum in wheat markets is expected to persist. Traders will also be watching for any shifts in demand from key importers like Egypt and North African countries, particularly as Black Sea-origin supplies remain constrained.

BARLEY

• Barley follows whole grain complex upwards on Black Sea conflict progression

UK feed barley markets have been heavily affected by wheat markets since harvest. While harvest barley was significantly discounted as movement pressure mounted, forward markets attracted a healthy premium over harvest. Wheat markets and barley markets have retained support as the entire grain complex continues to be heavily affected by the Russia-Ukraine conflict and disruption to Black Sea grain shipments and infrastructure. Currently no firm resolution to the conflict is in sight and nor any agreement that will allow grain shipments in the area to flow freely again. Any rumours of resolution have added considerable volatility to the market, but any such rumours have quickly been suppressed. When these rumours do appear the market does react and switches to a downward trajectory very quickly, a reminder of what this market will do if Black Sea grain is allowed to flow once again.

• Failed malting adds to the East Anglian feed pile

East Anglian feed barley is tracking wheat upwards but is heavily discounted in the feed ration by over £20-22/mt. Many other English markets see barley as a £15-17/mt discount to wheat, but East Anglian feed barley remains under pressure as failed malting barley continues to hit the feed market. East Anglian spring barley has yielded particularly poorly and high nitrogen results in the drought-affected crops has hit the malting quality hard. The maltster continues to show no signs of changing their intake specifications to allow more marginal barley to make the grade, so currently there is nothing to stop East Anglian feed barley stocks rising and malting barley stocks declining.

OSR

• Market overview

The OSR market remains well supported, although recent trading has been volatile. Price movements continue to be heavily influenced by developments in the wider vegetable oil and energy markets, as well as geopolitical risks affecting global oilseed supply.

Recent market data indicates that Paris rapeseed futures experienced a modest decline following a strong rally during the previous week. UK delivered rapeseed prices also eased slightly, although values remain relatively firm.

• Recent price performance

Paris rapeseed futures for November 2026 closed at approximately €538.25/mt, representing a weekly decline of €7.25/mt. In the UK, delivered rapeseed values for November were reported at approximately £471–£473.50/mt. This represented a small week-on-week reduction after stronger gains in the preceding week. Overall, the recent decline appears to represent a market correction rather than a significant change in the underlying market outlook.

Key market drivers:

• Energy markets

Crude oil prices remain an important influence on the rapeseed market. Stronger energy prices can support demand for vegetable oils, particularly where biofuel demand is a significant factor. However, fluctuations in oil prices and geopolitical developments can also increase market volatility.

• Black sea supply

Supply risks associated with Ukraine and Russia continue to influence the global oilseed and vegetable oil markets. Any disruption to production, processing or exports from the Black Sea region could tighten global supplies and provide further support to rapeseed prices.

• Soybean market

The soybean market is also contributing to the direction of the wider oilseed complex. Stronger export demand and increased expectations for crushing activity have provided support to soybean prices, with positive sentiment potentially transferring to rapeseed and other oilseeds.

• Vegetable oil supply

Palm oil production remains an important factor for the global vegetable oil market. Weather developments in Southeast Asia could affect future production prospects, creating the potential for tighter vegetable oil supplies. Reduced palm oil availability would generally provide support to competing oils, including rapeseed oil.

• UK crop outlook

Prospects for the 2026/27 UK oilseed rape crop have improved, with planted area estimated to have recovered from the particularly low levels seen in 2025.

Improved establishment conditions and better management strategies for cabbage stem flea beetle have contributed to increased confidence among growers. Despite this recovery, the UK oilseed rape area remains below historical levels, meaning domestic supply could remain relatively tight.

The development of the crop over the coming months will be important in determining production potential and the extent to which increased plantings translate into higher domestic availability.

FERTILISER

• Nitrogen Market Update

The UK nitrogen market has seen a little more activity following recent supplier price increase announcements, with both ammonium nitrate and urea values moving firmer. However, overall buying remains well behind where it would normally be at this stage of the season, with recent import statistics confirming that low imports have largely mirrored low demand.

For much of the summer, the UK nitrogen market has been driven more by weak demand than any shortage of product. Fertiliser remains available and there is no immediate sign of shortages, but the market is entering the autumn from a very different position to recent years. Lower sales have been matched by lower supply, meaning stocks have not been quietly building in the background.

Across the UK trade, there is a growing view that only around 50% of typical seasonal nitrogen demand has been committed so far. At the same time, suppliers remain cautious about carrying large inventories without clear demand signals from the farm gate. Fertiliser is increasingly expensive to manufacture, import, transport and store, meaning the supply chain relies on forward purchasing to position stock, book logistics and ensure product is available when required.

Recent rainfall is encouraging growers to refocus on spring nitrogen requirements. Spring UAN remains available to secure, offering an opportunity to take some uncertainty out of next season's fertiliser plans. However, solid nitrate offers remain largely limited to October through December delivery periods, providing little visibility into 2027 at a time when Carbon Border Adjustment Mechanism (CBAM) and wider market risks continue to cloud the outlook.

With only around 55 working delivery days remaining before the end of the calendar year, a significant volume of fertiliser may still need to move through ports, stores and farm gates before spring. The key question is not whether fertiliser is available today, but what happens if a large proportion of growers decide to buy at the same time.

Even when product is available globally, haulage availability, storage capacity, logistics networks and delivery schedules can quickly come under pressure when demand becomes concentrated into a short period. The risk is not necessarily a lack of fertiliser, but a lack of flexibility within the supply chain.

European natural gas remains the biggest influence on nitrate production economics. Gas prices remain above €60/MWh, more than 100% higher than at the same point last year, maintaining significant cost pressure on European AN and CAN manufacturers, and limiting the scope for meaningful price reductions.

Globally, the urea market remains balanced following the recent Indian tender, with China securing most of the volume. While this has taken some immediate pressure out of the market, the wider outlook remains uncertain. Ongoing tensions in the Middle East continue to create concerns around energy markets, freight costs and global fertiliser supply chains, while demand is expected to return as markets begin positioning for spring 2027.

The introduction of the UK CBAM on 1st January 2027 adds another layer of uncertainty. While the full impact on imported fertiliser costs remains unclear, both suppliers and growers are increasingly aware that replacement values next spring may look very different from those available today.

The wider market also continues to adjust to the effects of the Russia-Ukraine conflict, sanctions, banking restrictions, and ongoing trade uncertainty. Even where the UK is not directly dependent on certain origins, changes in global trade flows can influence replacement costs, product availability and competition for supply.

• Questions for UK growers

The challenge today is not knowing whether current prices represent an opportunity or whether waiting will result in higher costs, tighter availability, or fewer purchasing options.

The market is not short of fertiliser today, but the margin for error is considerably smaller than normal. Lower imports, reduced stock buffers, elevated gas prices, CBAM uncertainty and limited delivery time before the calendar year end all point to a market carrying more risk than many appreciate.

The risk is not that fertiliser suddenly disappears. The risk is that too many tonnes are left too late. If autumn demand returns quickly, product choice may narrow, logistics could come under pressure and replacement values could move higher faster than expected.

The fertiliser market does not need to run out of product to become difficult. It simply needs too many tonnes to be required at the same time. That may prove to be the defining risk of the 2026/27 season.

This message is echoed in a communication yesterday from the UK Fertiliser Farming Stakeholder Group made up of organisations representing UK farming and fertiliser sectors. Click here to understand 'Why Timing Matters This Season' for fertiliser purchasing and who's represented by this group.

 Please speak to your Frontier advisor 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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