News

As commodities fall out of favour with Fund Managers International wheat buyers have been active. Iraq has purchased 700K for spring shipment which will be supplied from the US, Canada, Russia and Australia. This distribution of suppliers adequately demonstrates the availability of wheat around the globe. Egypt has also been active buying 250K to be shipped from Russia, Kazakhstan, and finally after months of trying, a cargo from France. This follows a sale of 700K of French wheat to Algeria which was concluded over the weekend. Internal EU trade has been slow with Northern EU struggling with logistics as ice affects the barge traffic. An absence of farm selling is making traders wary of discounting the market too much to get International sales on the books. There has been an active trade in new crop barley as French traders secure outlets as there will be no intervention support next season. Export licenses taken this week were 384K taking the season totals to 11.2 mln.

Outlook: wheat fundamentals remain bearish, the corn complex is potentially tight, but for the moment outside interest in committees is waning.

Wheat

Grain prices stabilise
Trading slow
Milling premiums slip

After close to a month of falling prices grain markets have stabilised. A lack of willing sellers, as ex farm feed wheat edges close to £90 for spot collection, is lending support but the fundamentals remain negative. Despite the fall in prices, UK wheat is no more attractive to buyers than at the turn of the year. The milling market has been reasonably active as annual flour sales are covered by millers. Premiums have slipped, with full specification group 1 wheats` now £15 to £17 over feed at the point of delivery. Low protein milling wheat`s have no premium in the spot position and only command £1 to £3 over feed for summer collection. Miller`s usage of UK supplies has increased according to recent data from DEFRA, due to the high quality of last years crop.

Outlook: Any rally due to inelastic supply should be viewed as an opportunity to reduce unsold stocks.

OSR

Domestic market supported by cold snap in the short term.
Increased production estimates for South American crop to weigh on market.
Lower crude oil on weaker sentiment firmer USD$.

Nearby Matif has gained €6.50 to the time of writing with the domestic market reflecting £5 gain in the same period. These gains are surprising given the news in the global market place. We see this short term support being generated by European consumers forced into the spot market following the recent cold snap. This means barge transportation on the continent has been restricted due to frozen waterways, leading to road transport options for continuity of supply. A firming STG has also prevented better gains in the domestic market, with this strength being helped by issues in the EU.

Overseas markets have seen soybeans prices affected by the firmer USD$ (making USD$ denominated assets more expensive). Trade news suggested that China was expected to reduce its Soybean imports whilst we saw further increases in South American soybean production estimates.

The USD$ has gained over the last week on the back of continued inflows of capital following last week`s better economic news. This has had a knock on impact on crude values along with concerns over short term demand.

We have seen a report today from Informa Economics in which they have increased their estimates for South American production. They have increased Brazilian production by 500K tonnes to 66.5Mn tonnes and Argentinean production by 1Mn tonnes to 54Mn tonnes, both over the last month. This is a combined 2.5Mn tonnes above the USDA`s January number, with keen interest now being shown for the USDA`s next update scheduled for February 9th.

Bank of England monetary policy committee meeting yesterday decided to keep interest rates on hold and more importantly announced a halt to the quantitative easing programme. They reported that £200bn has been injected into the economy and that they saw no immediate need to increase this support. Although a firm closing of the programme was not mentioned. This announcement in line with the ongoing issues in the Euro zone with Greece and latterly Spain should mean STG remains firm in the short term.

Oats

A recent sale of a feed quality vessel had demand for product met in one day. This highlights the saturation of the old crop market. As a guide, nominal values see feed quality in the mid £50 region and top quality milling oats around the £75 level for May/June. Market continues to suffer from a surfeit of production and is unlikely to change in the near term. We continue to explore export opportunities when available. New crop demand remains nil.

Pulses

Beans, market prices are seen drifting lower as a lack of buyers precludes trade at the current time. We have seen some enquiries for spring beans and we anticipate a return of buying interest toward the end of February. New crop values are seen nominally at £120 ex farm however there are no firm buyers at present.

Peas, The very recent news concerning the sudden lack of demand for vining peas, particularly in East Anglia region, has prompted a raft of enquiries for pea buyback contracts. These are proving very hard to find as many deals had already been tied up. Please speak with your Openfield buyer for the latest availability.

Fertiliser

Crop Yield Potential
Soil Type and Texture
Crop Nitrogen
Measured Soil N

The GrowHow N-Min ® N-Calc ® campaign is now in full swing and results will start coming through in the next few weeks.

Research conducted by ADAS has shown that there are four key influences on a crops Nitrogen fertiliser requirements:

The Grow How N-Min ® N-Calc ® takes each of these areas into account to produce a very specific recommendation for your crop.

Sampling can continue up to the point of any Nitrogen application, so to book a test please call Russell Davison on 01476 862787 or speak to your Farm Business Manager.

Seed

The withdrawal from the market of one of the major vining pea processors has caused considerable activity in the combining pea and bean market with supplies tightening sharply. Marrowfat peas are sold out and large blue peas selling quickly. Spring beans are still available and Openfield are looking for seed acreage of Fuego as well as human consumption buy backs.

Spring barley is selling at steady pace across both England and Scotland, spring wheat is all but gone although seed acreage is required for both wheat and barley at healthy premiums.

Oilseeds have taken a back seat but could become more popular again should the cold weather return and delay planting decisions further.

The Openfield maize portfolio is second to none with varieties from the 3 top breeders, if you suspect you have been paying £50 per bag for game maize you may wish to review our selection of NIAB listed varieties on the website or ring your local Farm Business Manager for a summary sheet of the range.

Other information

We have many events being held including; Seed trials days, Member meetings and Seasonal seminars. For detials of events near you please view the diary page of the webiste.

Disclaimer

While the information contained herein is believed to be reliable, Openfield makes no representation as to its accuracy or completeness. Any statement non-factual in nature constitutes current opinion, which are subject to change.