Get in touch: send your photos, videos, news & views by texting YORK to 80360 or send an email»
European OSR crop set for five-year low
2:38pm Friday 11th May 2012 in Eco info
In her monthly column, EMMA CROFT of Anderson Grain Marketing Ltd analyses the global grain market.
LOOKING firstly to the wheat market, we have seen a divergence of old crop from new crop over this last couple of weeks. While old crop has moved notably higher, new crop has dipped significantly lower, widening the gap between the two to almost £25/T (at the beginning of April this was just £12/T).
Old crop has traded anywhere between £165-176/T spot ex-farm over the last four weeks and as we go to press spot ex-farm values have eased a little and are currently around £167/T, with the benchmark £170/T only achievable for late summer collection.
Although we have seen renewed export interest for feed grains – China are importing record quantities of maize corn to feed their rising demand for pork, thus supporting equivalent feed wheat values – domestic end-user demand has become rather thin.
New crop wheat has, on the other hand, dipped fairly significantly. As available harvest movement has slipped below the £150/T ex-farm mark into the mid £140’s/T while November/December movement is trading around £147-8/T ex-farm.
Improved weather across southeastern Europe has eased drought fears and milder temperatures across much of the Black Sea region have brought ‘favourable’ conditions for developing crops there; both of which have pressured new crop prices over the last four weeks. Elsewhere, the OSR markets have demonstrated massive volatility.
Old crop farm-sellers could have achieved anywhere between £370- 395/T for May/June collection in April, with current ex-farm values – having significantly eased over the last ten days – at £370/T.
As for new crop, values have fluctuated between £360-375/T as available ex-farm and have levelled at around £360/T; the difference between the two is expected to narrow as the month progresses.
Harvesting of soybeans in both Brazil and Argentina is not going quite as well as expected, nor is it expected to do so for the remaining South American countries.
Furthermore, the European oilseed crop is expected to drop to a five-year low of 18.5M/T.
Combine the above with the fact that China intend to import a massive 50M/T of soybeans this year and it has hardly surprising that values have remained so well supported.
This month will see northern hemisphere crops developing and a clearer yield picture as a result.
Additionally, we could see a potentially early start to the American harvest and thus an easing of any supply/demand fears, and the first long-term view for 2012/13 from this month’s USDA supply and demand report.
Comments are closed on this article.