Lacklustre wheat trade limits sales on farm
© Tim Scrivener Steady demand in domestic markets and limited export potential for UK wheat have capped any price gains in the short term.
UK wheat prices have remained sluggish in the past week despite rises in global commodity markets such as wheat and oil, due to conflict in the Middle East.
Dry conditions in Australia as a result of El Nino weather patterns and reduced wheat exports from Russia are also helping to support global prices.
See also: UK wheat exports struggle to compete on global stage
UK feed wheat futures opened at £183/t on 11 October for the November 2023 contract, down £4.30/t on the week.
Support for spot prices
However, traders are saying that a lack of producer selling is helping to support spot prices.
Spot prices for feed wheat averaged £176.4/t on 11 October, while milling wheat remains at a large premium and averaged £241.3/t.
Simon Wilcox, Cefetra grain origination manager, said the market was offering very little at present and continued to drift.
“We probably need to get further into the season to see better interest and markets open up again,” he added.
Traders at Openfield said that with this year’s planted and harvested wheat area being one of the smallest for a very long time, along with both variable yields and quality, now is the time to evaluate this year’s grain and consider plans for the next season.
The next major market driver is likely to be the US Department of Agriculture latest World Agricultural Supply Demands Estimate report, which is due for release on 11 October.
A larger US wheat production figure is expected, which may add some pressure to global markets.