Market Overview
Wheat / Barley / Maize
The 2024 UK wheat harvest is now into its closing stages. As of 28th August, 88% of wheat had been harvested across the UK.
UK wheat yields are forecast to be back 8% on the 5 year average, with the industry pegging yields between 7-8T/ha.
These lower yields combined with the reduced cropping area could lead to an overall wheat production of 11MT, well below last years figures of 14.1MT, but in line with previous expectations.
There have been further downward revisions to EU yield and crop estimates. The German wheat crop is now estimated to drop by 12.7% on the year to 18.8MT
The lower yield and crop estimates are currently being offset by highly competitive Black Sea exports which have been pressuring the global market.
Going forward, global wheat prices could be influenced by stronger than expected US export sales, dry weather conditions in South America and the Black Sea region and future global maize prices.
While the EU barley crop this year is expected to be much larger than last years poor harvest, it is still smaller than initially expected.
UK barley is currently trading at a £20/T discount to wheat.
As of Tuesday, 38% of UK spring barley had been harvested. A rise of spring barley area (28%) from last year has offset the substantial fall in winter barley which is down by 17%.
There are raised concerns over South Americas maize planting season. Brazilian farmers are reporting the driest conditions seen in 40 years. Brazil and Argentina will begin their planting season from mid September through to November. Decent rain will be crucial in the next two months.
Bueno Ares Grain Exchange have predicted a 17% drop in Argentina’s Maize are for 2024/2025 due to ongoing pest and disease pressure.
Brazil and Argentina are expected to produce 178MT of maize. However, if the dry weather persists and the disease pressure is not dealt with, we could see further cuts to the crop figures.
EU maize production is now lower than in 2023 despite the expanded area.
The US are projected to produce 384MT of maize for 2024, a six year high.
Hi Pro Soya / Rapemeal
Brazil, the largest global soybean producer, usually starts planting in September/October. However due to the ongoing dry weather conditions, planting progress could be hindered and lead to yield concerns. Brazil is still projected to produce a record soybean crop of 169MT. Argentina are expected to recover from last years low production and produce 51MT this coming season.
Higher than expected demand for US Soybeans has offered some support to the global market.
The US are expecting to produce 125MT of soybeans for 2024/2025. However, the US Soybean crop ratings fell by 2 points rated good-excellent this week due to ongoing dry conditions.
Canada are expected to increase their rapeseed crop by 1.6% from last year. However, EU rapeseed production is expected to drop by 8.7% to 18MT.
Despite recent strengthening in the vegetable oil complex which has offered support, ample global soybean stocks + the stronger Canadian rapeseed production has kept a lid on prices.
