As we enter May the latest AHDB Grain market report shows grain prices holding despite revised forecasts for the Russian wheat crop. A dry spell had impaired crop conditions but with wetter weather expected, regional commentators anticipate crops to recover.
However, weather concerns out west have limited the downward pressure. The USDA (US Department of Agriculture) has revised crop conditions down with dry conditions spreading across the US winter wheat belt. At the end of April, the USDA reported that 30% of US winter wheat was located within the drought-stricken area, up from 18% in the middle of the month.
UK feed wheat futures (May-24) currently stands at £179.90/t down slightly from April’s close. New crop futures (Nov-24) also dipped to £203.00/t.
The market is still incentivising people to store grain into the new season. The gap between old crop and new crop prices is large, in the region of £20/t. So, it could be worth exploring using stores to carry old crop which might offset some of the revenue loss for a smaller crop.
That said, the UK is still likely to experience a greater reliance on imports for 2024/25. Quality concerns over the 2024 crop mean milling wheat imports are likely to increase.
The gains in rapeseed prices seen at the close of April also held with Paris rapeseed futures (Nov-24) currently at €465.75/t. This is a slight fall from the peak of €471.75/t on Monday 28th April, falling demand weighing on the oilseed complex as rival oilseeds compete for market share. The old crop contract (May-24) closed at €447.50/t.
