The latest HGCA market report suggests the UK will continue to be a net importer of wheat. The report raised wheat import expectations and, as a result, first estimates of end-season stocks.

Reduced plantings have further deflated forecasts for the UK crop this year. Imports remain high as a result of the ravages of 2012, which hit the yields and quality of UK crops. HGCA said imports this season are expected to be three times as high as last year. Nevertheless, this accumulation has led to higher end of season stock estimates. (End stocks are predicted to be at their highest in the UK since 2009/10).

Although growers in the UK are facing another challenging season, in Europe as a whole, forecasts are more promising. The EU Commission's MARS report forecast EU-27 yields close to the five year average last week. In mainland Europe, the return to favourable conditions has reportedly offset the delays to planting, with crop development accelerating at a promising pace.

Though there are still concerns for the UK crop, HGCA said last week that conditions improved over May, and that, as a result of fairer weather, "many winter cereal crops are now seen in good condition, although development is still delayed." As a result of the prolonged cool, damp weather earlier this year, development of winter cereals also remains slow in more Northerly contiguous EU states, including the Netherlands and Belgium.

Domestic new crop UK feed wheat prices fell again last week, reducing UK wheat's premium over Paris wheat, but HGCA suggested that the fall below £180/t served to stimulate some demand for new crop wheat.