Feed wheat slumps to £182/t as global pressure mounts

Feed wheat values have fallen sharply, dropping below the £200/t mark for the first time in more than a year, reflecting the overall weakness in the trade globally, as well as the imbalance between supply and demand at home.

The Farmers Weekly spot feed wheat price, derived from a cross-section of merchants around the country, stood at just £181.60/t on Wednesday (22 March), compared with £209/t a week earlier and £300/t a year ago.

The last time it was sub-£200/t was in October 2021.

See also: UK oilseeds markets fall below £350/t

London May futures, which represent a theoretical delivered price rather than an ex-farm price, also dropped below £200/t, closing at £199.75 on Tuesday (21 March), slipping further to about £194/t on Thursday morning (23 March) – a drop of more than £30/t in just over three weeks.

According to the AHDB, UK values have followed global wheat contracts down, based on improved weather across the US grain belt as well as the extension of the Ukrainian grain export corridor, easing concerns over Black Sea supplies.

“Cheap Russian supplies especially continue to provide tough export competition for EU wheat,” said senior arable analyst Megan Hesketh.

“Financial market concerns, following news on Swiss bank Credit Suisse, weighed on global grain markets, too.”

Stronger sterling

Analysts CRM Agri suggested that a stronger pound sterling may also have pressured UK prices, as higher-than-expected UK inflation data on Wednesday (22 March) lifted expectations for a further interest rate rise by the Bank of England on Thursday.

Simon Wilcox of Cefetra Grain also pointed to the relatively weak demand situation in the UK, suggesting that “domestic consumers remain on the sidelines”.

“Indeed, there is still an exportable surplus and it remains to be seen whether demand for UK exports persists and much of this can find an outlet,” he said.

However, Mr Wilcox noted that new crop futures have been relatively well-supported given the weakness in old crop.

“This is due to the uncertainties still surrounding this coming harvest and the possible weather stories yet to play out across the world’s wheat-growing regions,” he said.

November wheat futures closed at £209/t on Wednesday (22 March) – just £10/t down on where they were two weeks ago.