With sterling gaining against the euro and the US dollar, it brought further pressure to domestic grain markets. The AHDB market report shows UK feed wheat futures (May-26) slipped further last week, currently sitting at £167.40/t.
The issue of supply and demand also continues to weigh on markets. The January USDA World Agricultural Supply and Demand Estimates (WASDE) predicted increased global wheat consumption for 2025/26. However, it also estimated higher stocks after high productivity from both hemispheres. Looking ahead to the next harvest, it suggests a big US maize crop is likely.
In the near and medium term, futures prices could react to concerns regarding the weather for winter wheat in the Northern Hemisphere and maize in Brazil and Argentina.
Oilseed complex supported by canola deal
Rapeseed prices have continued to rise, following trade talks between Canada and China. The lifting of tariffs has freed Canadian canola exports and released stocks that have weighed on markets.
The May-26 contract stands at €476.50/t, its highest price since early December. The Nov-26 contract also rose to €464.25/t.
There is also positive news on the US biofuels front. It looks like America will move forward with its Renewable Fuel Standard (RFS) program, a decision expected in early March.
Increased demand for vegetable oils ahead of Ramadan and the Chinese Spring Festival (New Year) also helped support prices, as did an increase in Brent crude oil futures.
These factors more than offset news that Indonesia has cancelled its planned move from B40 (a blend of 40% biodiesel and 60% conventional diesel) to B50. LSEG reports that the cancellation is due to funding and technical concerns. The rise would have increased the amount of palm oil required for biodiesel in the world’s top producer of the oil.
