Improving weather conditions in the US and the strengthening of the US dollar have pressured grain markets this week.
The latest AHDB Grain Market Report shows close to a £4.00/t slide in UK feed wheat futures (Nov-24) falling to £174.05/t. The May-25 contract lost more, it currently sits at £186.60/t.
Recent rains have improved the condition of the US winter wheat crop. According to the latest USDA crop progress report, 44% of US winter wheat was rated good-to-excellent on 10 November. This is up 3 percentage points from the previous week.
In addition, winter wheat planting is 91% complete, up from 87% last week. Although plantings fall short of the average it is closer to analyst expectations.
The US dollar hit a six-month high earlier in the week against a number of currencies, driven by strong economic data and market reactions to potential policy changes. This surge weighed down on European wheat markets.
Rapeseed prices hold
However, rapeseed price support continues. Paris rapeseed futures (May-25) currently stand at €529.25/t, exactly where it closed on Friday (8th November). The Aug-25 contract is at €492.25/t.
Support for Paris rapeseed comes from rising palm oil prices and the Euro falling against the US dollar. However, the US soyabean harvest could weigh on markets, as could Donald Trump’s choice for head of the US Environmental Protection Agency. Lee Zeldin is perceived to be unsupportive of the biofuel industry, which could potentially reduce demand for soybean oil, a key biofuel feedstock.
