With concerns over the state of Russian crops easing, and good harvest progress in the US, grain prices have dipped a little from the high as May came to a close.
The latest AHDB Grain Market Report has UK feed wheat futures (Nov-24) at £214.25/t, a gradual decline as the first week of June progressed.
The recent USDA weekly crop progress report, released on Monday, June 3rd added momentum to the downward pressure. According to the report, 49% of the US winter wheat was rated good/excellent, marking a slight increase from 48% at the end of May and ahead of the 36% rating for the same period last year. Also, spring wheat condition was rated at 74% good/excellent, surpassing the previous year’s rating of 66%.
As did the latest crop report from the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES). A larger wheat crop is expected in Australia, specifically, the area for winter crops. At 23.6 Mha this is 6% above the ten-year average up to 2023/24.
The AHDB advises growers to keep a close eye on crop progress reports from other major wheat producers.
Longer term the AHDB suggests the market will remain bullish. Wheat demand is continuing to rise and domestic 2023/24 usage in the milling and distilling sectors has remained stable.
Despite the cost of living crises, a survey by market research firm Kantar has revealed UK consumer foodservice spend has increased by over 15% – March 2023 – 2024.
The report found that a quarter of consumers are still struggling financially, and 66% are concerned about the rising cost of food. Despite this, people spent 15% more on foodservice and with the number of occasions (visits) growing by 12% over the same period, it suggests foodservice growth is not just inflationary.
Consumers have been ‘trading down’ by taking advantage of meal deals but if inflation falls analysts expect to see greater willingness for consumers to spend.
Oilseed markets
European rapeseed prices were also pressured by favourable weather and planting prospects, plus heavy South American soyabean supplies.
Paris rapeseed futures (Nov-24) currently stand at €476.25/t, down close to €20 on May’s close.
