Farming News - Burdensome global wheat position, USDA raises its forecast of 2017 18 ending stocks by 5mln t.

Burdensome global wheat position, USDA raises its forecast of 2017 18 ending stocks by 5mln t.

WHEAT

The US soybean harvest is now well underway and, with no reported yield issues, looks set to be another record.

 

Nevertheless, prices have remained largely unchanged over the past week, as weather concerns in South America seem to be offsetting any harvest pressure in the US. This is despite the fact that Brazil is still carrying record stocks after last season’s bumper harvest.

 

Canada’s canola harvest is progressing well. Yields are much better than expected, given the concerns about the state of the crop pre-harvest, following the hot, dry weather seen across the region during the early summer. The crop should now exceed 20mln t.

 

In Europe, Matif rapeseed futures prices continue to come under pressure, with burdensome supplies and a firming euro keeping the market on the back foot.

 

Ongoing import programmes from the Black Sea are likely to add pressure to a market that is already well supplied. It is reported that several of these cargoes will be tendered in port silos against the November futures contract.

 

Imports continue into the UK.  Given the circa 2mln t production this year, one could argue that we don’t need these additional volumes, but the domestic market has been reluctant to release material at current prices, and the crushers have been forced to look to imports to supplement their home-grown supplies.

 

This isn’t a great situation for the UK farmer, as the UK is already in a surplus situation with prices £10-£15/t above export parity.

 

 

Given the current bearish outlook for the oilseeds complex, the UK needs to see a crop problem in South America, or sterling to depreciate, if our farm gate prices aren’t going to slip further.

OSR

The US soybean harvest is now well underway and, with no reported yield issues, looks set to be another record.

 

Nevertheless, prices have remained largely unchanged over the past week, as weather concerns in South America seem to be offsetting any harvest pressure in the US. This is despite the fact that Brazil is still carrying record stocks after last season’s bumper harvest.

 

Canada’s canola harvest is progressing well. Yields are much better than expected, given the concerns about the state of the crop pre-harvest, following the hot, dry weather seen across the region during the early summer. The crop should now exceed 20mln t.

 

In Europe, Matif rapeseed futures prices continue to come under pressure, with burdensome supplies and a firming euro keeping the market on the back foot.

 

Ongoing import programmes from the Black Sea are likely to add pressure to a market that is already well supplied. It is reported that several of these cargoes will be tendered in port silos against the November futures contract.

 

Imports continue into the UK.  Given the circa 2mln t production this year, one could argue that we don’t need these additional volumes, but the domestic market has been reluctant to release material at current prices, and the crushers have been forced to look to imports to supplement their home-grown supplies.

 

This isn’t a great situation for the UK farmer, as the UK is already in a surplus situation with prices £10-£15/t above export parity.

 

 

Given the current bearish outlook for the oilseeds complex, the UK needs to see a crop problem in South America, or sterling to depreciate, if our farm gate prices aren’t going to slip further.