Old crop feed wheat has traded the same this week at £152/T ex-farm. For those of you with any old crop feed barley left in the shed, values appear to have plateaued at £150/T ex-farm.
Markets have remained driven by weather and the continued uncertainty of spring planting. The World Agricultural Supply and Demand Estimates (WASDE) report was out on the 10th of April and again, has done very little to encourage the market. The weather over in the US has seen all types conditions last week; heavy snow in the north, cold with excessive moisture in the Midwest and Delta and droughts in the Southern plains.
Current weather in the UK has delayed spring drilling and application of treatments (to winter crops), if this continues and then we see temperatures turn excessively warm, winter crops with shallow roots could be affected from stress – lowering potential yield.
Meanwhile, the weather in the US is going to have a further impact on farmer’s future sowing decisions, favouring a move to maize corn rather than soybeans. However, US farmers still need to understand what the 25% export tariff on US soybeans into China means for domestic US price development.
The US soybean market could potentially see a significant upside if global production is affected by the US weather events.
On the other hand, the old crop rapeseed market does not have the same potential outlook as the soybean market. Reports have suggested European processing plants are switching from rapeseed to soybeans; this has affected the French rapeseed futures, along with the fall in demand from the biodiesel sector as Argentinian imports continue to flood the European Market.
Last week, UK ex-farm values drifted and are struggling to hold on to £290/T ex-farm. This morning, spot collection is valued in the region of £285/T ex-farm as sellers continue to hold off.
Vivergo have officially announced that the plant has re-opened following a four month shut down period following unfavourable trading conditions; “in part driven by Government inaction on the future of renewable fuels”.
Following this, the bioethanol industry is now calling for the Government to introduce E10 fuel by the end of the year. “E10 is a more environmentally friendly blend of 10% renewable bioethanol with petrol which can lower emissions from vehicles”. It is commonly used across North America, Europe and Australasia and introducing it in the UK would be the carbon emissions savings equivalent to taking 700,000 cars off the road.
The current intake capacity of the plant is unknown within the trade but judging by current intake levels, they look set to be fully online within the coming few weeks.