David Sheppard, Gleadell’s managing director, comments on the wheat market

The US market is trading down on the week, pressured by improving US harvest prospects.

Winter wheat crop ratings improved by 2 percentage points on the week and, with initial corn ratings reported at 79%, the best for five seasons, the market ran into selling as traders returned after the holiday.

Weather remains a mixed bag. Needed rains and cooler temperatures arrived in the Northern Plains and Canada, wetter than normal conditions have been seen in the East and Delta and dry, warm weather in the Southern Plains, where the wheat harvest is due to start this week.

The harvest activity in Texas will provide the trade with the first indication of quality and yield potential, following this year’s drought conditions.

European markets have been rocked this week by the turmoil in Italy, which sent the euro in decline and futures to a near one-year high.

Talk of the likelihood of fresh elections and the potential of increased support for the populist vote uneased the markets, leading to a sell-off of government bonds.

Global weather concerns and the weaker euro had seen futures rally by €15/t in two weeks, although the reversal in the US markets saw futures fall over €5/t yesterday.

Dryness concerns are evident in much of Germany, Poland and the eastern states, although much of the south and west continues to show above average precipitation and cooler temperatures.

UK old crop remains little changed, with interest still apparent from end-users and market shorts. Like the other exchanges, weather-related issues have rallied new crop, although the market dipped just over £3/t yesterday as the other exchanges weakened.

Gleadell comment

Weather-related issues took the markets higher but, as some of these issues wane, markets will react to the downside. Although the US picture looks more promising, this is countered by continued issues in Australia, the Black Sea region and now parts of the EU.

Geo-politics and macros are now also included in the mix, clouding the picture further, although for the longer-term, the wheat market will be driven by what the weather does and its impact upon harvested crops.

Jonathan Lane, Gleadell’s trading director, comments on the OSR market

New-crop Matif rapeseed has weakened this week, mirroring the decline seen on CBOT soybeans.

In the UK, the perceived high ending stocks for 2017/18 are creating a significant discount for harvest rapeseed compared with values later in the marketing season, where prices are more reflective of the global concerns around the crop.

As is normal for this time of the season, the market will be subject to constant change as it prices itself around weather concerns and geopolitical developments.

The focus for now will be on a potential trade tariff between the US and China, rainfall concerns in the US, the reduction in planted area in Canada, dryness across the Black Sea region and Australia, as well as the size and quality of the Argentine soybean harvest and weather across northern Europe for the remainder of the growing season, and of course Brexit.

Calum Findlay, Gleadell’s fertiliser manager, comments on the markets

In the arable sector, markets have quietened this week for bagged fertiliser, as attention has turned to purchasing late nitrogen to boost milling wheat proteins.

Gleadell can offer both an 18% N foliar urea solution, with or without sulphur, and the unique nitrogenous fertiliser, ENhancePro, formulated with ammonium thiosulphate.

Grassland buyers continue purchase after-cut fertilisers. CF remains in a strong position to service this market and has rolled May terms into June, holding off releasing any new season prices.

Recent changes in the urea market and the weakness of the pound against both the dollar and euro have seen speculators raise their forecasts compared with 7-10 days ago.