The Grain column with Emma Croft

Emma Croft, farm trader at Anderson Grain Marketing Ltd.
Emma Croft, farm trader at Anderson Grain Marketing Ltd.

It has been another volatile week for the grain market as the value of the pound continues to fluctuate against other major currencies.

Since June, most ‘Brexit-based’ decisions have had a negative impact on the value of sterling as the continued uncertainty adds pressure to the pound. However, last week’s announcement by the Government that a ‘Full Brexit’ alongside an exit from the Single Market would be their way forward provided a much-needed boost to currency.

Although the market remains nervous, in the short term it has been reassured by the outlining of the Government’s priorities as we move forward.

Regardless, feed wheat for spot collection is just about maintaining its £150/T ex-farm although £147/T could easily be a reasonable offer at this stage.

Since the old crop feed wheat market has moved upwards so quickly, milling wheat premiums have become squeezed as the Miller struggles to play catch up.

While premiums for Group 1 varieties at full specification achieved a £7/T-£8/T premium before Christmas, today, a £4/T-£5/T premium looks generous.

Furthermore, with Vivergo due back online next month (apparently), Yorkshire is once again positioned in a unique situation as buyers seek to make short term cover for the re-opening.

This puts local ex-farm values at a premium compared to other areas of the UK for feed wheat, adding further pressure to local milling wheat premiums (they appear small as the feed wheat base value is higher than it should be).

As for the new crop grain market, movement has been slightly less volatile over the last week or so.

Feed wheat for harvest collection is currently valued in the region of £135/T ex-farm while movement before the end of the year should comfortably make £140/T ex-farm.

Meanwhile, the upward trend evident in the old crop OSR market appears to have stalled this week as values remain in the region of £360/T ex-farm for spot collection.

The old crop OST market appears to be lacking in direction generally at the moment; on the one hand we are seeing weather issues across Argentina as February brings an end to their planting window, yet on the other hand the USDA figures for South American oilseed production generally are huge – we would need to see serious issues develop in Argentina for overall supply figures to be down year on year.