Thursday 15 February 2024

Malting Barley

• Malting barley prices have come under further pressure this week. With no demand to speak of and the feed base price under pressure, prices continue to drift lower.
• New crop values are down again on the week, following the same theme as old crop with low demand and a very relaxed feeling on production, support is not there and prices are down again on the week.
• All eyes will be closely following plantings and weather.

Rapeseed

• Soybeans trade lower this week, with Argentinian crop conditions improving. Last week’s USDA report posted a bearish picture once again, however, the trade refrained from reacting for the time being. The main focus, going onto the report, was South American production, where the Brazilian soybean crop was only reduced 1mln t to 156mln t, compared to an expected 153.15mln t. In Argentina, production was unchanged at 50mln t vs. 50.84mln t. World ending stocks were the main surprise, being increased from 114.60 billion bushels to 116 billion bushels compared to an average estimate of 112.48, and US ending stocks were increased from 280 million bushels to 315 vs an expected 284.
• Since the report, Argentina has started to receive much-needed relief in the form of increased precipitation, which has led to Rosario increasing the expected yield indicating a production of 52mln t. Brazil, however, has seen a turn for the worse in the weather and could have lost up to 100,000 Ha of crop. Crop conditions are lower this week, with 31% good/excellent compared to 36% last week. Production estimates are getting closer to 149mln t.
• Energy markets have been mixed this week as crude has attempted and failed to make a new high following another rise in weekly US crude oil stocks, rising 5.520 million barrels to now sit 17.243 million barrels below the 5-year average. Imports for the week were 1.302 million barrels per day higher at 6.907. The refinery operating rate was 0.5% lower at 82.4%. OPEC’s February oil market report kept 24 and 25 world demand growth unchanged and raised economic growth forecasts for both years.
• Veg oils are mixed this week, as soy oil tried to bounce from contract lows but failed. Palm oil on the other hand is higher on the week, as Malaysian palm oil stocks for January fell 11.83% from December to 2.02mln t. Crude palm oil production reduced 9.59%, while exports only dropped 0.85%.
• Canola is lower this week as Canadian farmers continue to try and catch up on farmer selling after being 2mln t behind in December compared to the 5-year average. Canadian crushers still manage to find cheap seed from the Black Sea, bringing weekly canola crush to a record high of 228,309mt – the weekly crush rate has only surpassed 220,000mt five times.
• MATIF rapeseed is higher this week, after finding support at €410, and has run into resistance at €425. The market is now in need of a new story to push prices back to nearby highs. In the short term, prices continue to trade in a downtrend.
• Sterling trades at 1.16900.

Pulses

Beans

• Another week of consumer bids drifting lower, primarily on the East Coast, as beans finally start to try and compete in the ration, especially for the summer diet. Despite this, beans still look too expensive to compete against the more aggressively priced proteins and cereals. We are starting to show signs of the bean price correcting, and we are starting to see the early signs of an increase in domestic demand as a result. There is still more work to do, however, with the falling value of GBP vs both EUR and USD, this will help temper the scale of the move required by beans slightly. The main takeaway from this is beans are starting their attempt to become more relevant once again within the mainstream domestic compound ration.
• The international markets have seen another week of geo-political volatility and instability. With Ramadan approaching, the focus will be on the Middle East, and especially Egypt from a faba bean perspective. The economic situation in one of the world’s largest consumers of faba beans continues to remain tense, with significantly reduced revenues from lower Suez transits adding to the economic woes.
• With February marching on, the weather continues to offer a mixed bag. The long-term forecast is showing some rainfall in the 4–7 day slot, although temperatures are also forecast to be warmer than normal for this time of year, which should help offset some of the excess moisture for those trying to drill. Whilst avoiding unnecessary soil compaction is important to seeing good establishment in beans, those that have drilled early in recent seasons have typically seen better yields at harvest. For those with questions about how best to get your beans established, contact your farm rep and they can share the advice from the PGRO, including considerations around drilling winter beans in the spring window.

Peas

• Feed peas continue to be in strong demand nationally. Supply issues are leaving consumers short across the UK, leading to high ex-farm prices, which have again risen week on week.
• From a human consumption perspective, green peas remain in extremely high demand due to the ongoing import duty situation across in India. Prices are pushing towards the £400/t delivered mark on farm for good quality with low bleaching. Please get in touch with your farm trader if you have any open market parcels!
• Our 2024 buybacks are becoming tighter on marrowfats and large blues, with seed availability dwindling. Please get in touch to avoid disappointment. We are still available to offer pre-February movement. Yellow peas are firmly available to those who would like a lower-risk spring cropping option.

Fertiliser

• North African granular urea appears under pressure at present as March shipment demand appears minimal in Europe. Weather and crop output prices are weighing on demand.
• US interest is reportedly increasing though which could support North African prices for March. Australian demand had supported prices east of the Suez at the end of last week into the beginning of this week.
• Nitram delivery windows have changed to full month April, and full month May is now available, giving options to those looking for later applications on grassland or late bag milling wheat applications.
• Imported AN still carries a premium in the spot market, and inhibited urea makes economic sense for those needing March delivery for April applications.
• Liquid UAN prices remain relatively static as UK prices have remained under replacement values, but some late demand in the UK could support spring fill. This is despite recent weakness in global markets which are bringing it more in line with UK values once again.
• N18 offers for milling wheat applications also are on offer from ADM at present.
• MOP prices remain available from ADM and demand has increased, DAP and TSP demand is also increasing, and ADM can offer 0PK, NPK and straight prices for immediate delivery.

NB: Prices quoted are indicative only at the time of going to press and subject to location and quality.

“Although ADM Agriculture take steps to ensure the validity of all information contained within the ADM Agriculture Market Report, it makes no warranty as to the accuracy or completeness of such information. ADM Agriculture will have no liability or responsibility for the information or any action or failure to act based upon such information.”

ADM Agriculture cannot accept liability arising from errors or omissions in this publication.

ADM Agriculture trade under AIC contracts which incorporate the arbitration clause.

Terms and Conditions of Purchase.

On every occasion, without exception, grain and pulses will be bought by incorporating by reference the terms & conditions of the AIC No.1 Grain and Peas or Beans contract applicable on the date of the transaction. Also, we will always, and without exception, buy oilseed rape and linseed by incorporating by reference the terms & conditions of the respective terms of the FOSFA 26A and the FOSFA 9A contracts applicable on the date of the transaction. It is a condition of all such transactions that the seller is deemed to know, accept and understand the terms and conditions of each of the above contracts.