08 May 2019
• Delivered to Belfast Feed Barley down £2.50/t, at £160.50/t
• Delivered to Belfast Feed Wheat down £3.50/t, at £179.50/t
• Imported to Belfast Feed Barley down £6.00/t, at £153.00/t
• Imported to Belfast Feed Wheat down £3.00/t, at £174.00/t
New-crop Wheat (Neutral to Bearish) – Although moisture levels across the EU are variable, conditions in the US and major Black Sea exporters are favourable.
• Bearish: Ukraine is forecast to harvest an all-time record wheat crop of 28Mt, UkrAgroConsult upped its 2019/20 forecast by 1.2Mt. The increased production forecast could allow an additional 3Mt of exports in 2019/20 over 2018/19.
• Bearish: The current condition of US winter wheat is the best since 2010 (64 percent of crop rated good to excellent). Additionally, old crop US exports are behind last year’s pace, despite a forecast year on year increase. In response, US Managed Money funds have increased their short position (USDA & CFTC).
New-crop Barley (Bearish) – Year on year increases in the planted area production forecasts across major growing regions.
• Bearish: Ukrainian barley production is forecast to be the largest in three years at 8.5Mt (+1.4Mt YoY) (UkrAgroConsult). Although dryness across Europe has led to slight downward revisions to EU production estimates, there is a potential area swap from oilseed rape to spring barley.
• Bearish UK: Domestic use for animal feed production in March was the lowest in six years. Additionally, cumulative exports to February have been the smallest since 2012/13. With a larger surplus in 2019/20 likely, new crop prices could be further pressured.
Delivered prices - The old crop domestic feed and milling wheat market has continued to have a bearish tone owing to adequate cover and limited demand.
• May-19 Erith rapeseed down £5.00/t, at £313.00/t
• May-19 Erith rapemeal (34%) down £6.00/t, at £178.00/t
(Neutral to Bearish) – Recently there has been an overriding bearish sentiment in oilseed markets. New crop Chicago soyabean futures (Nov-19) continue to plumb new depths, down $8.63/t (Friday 3 May), as the weight of global supply and demand add pressure to the market.
Paris rapeseed futures have been dragged lower over the past week. An underlying lack of demand, for both seed and its processed products continues to drive its weakness.
• One to watch - Concern for new crop corn plantings in the US continues to drive suggestions that more acreage could be planted to soyabeans. However, there is still ample time to plant corn and the weak soyabean price may work against increases. Rainfall in the US is seen as below normal over the next fortnight.
• Bearish - Canadian canola stocks forecasts from Statistics Canada are due to be released, showing stocks at 31 March. A pre-report Reuters’ poll anticipates a year-on-year increase in the stock level of between 0.75-1.4Mt, to 9.8-10.5Mt.
• Bearish - Prices for some vegetable oils have fallen over the last week. Palm oil prices dropped considerably last week on the back of large stocks and production. Oilworld maintain that the palm oil market is expected to tighten (www.oilworld.biz).
Aside from potential dryness concerns for new crop conditions in Europe, the outlook for oilseeds looks largely set to be neutral-bearish.