Are commodities undervalued?

M

mountfarm

Member

• Aug 1, 2022

• #1

What’s everybody’s view on commodity prices at the moment? Specifically wheat it feels like it’s undervalued presently. Barley yields are high so this could fall in value maybe due to demand?
The first ship has left the Ukraine loaded with wheat and whilst it’s probably going to Africa the 30 million tonnes to come out could push markets down further?
But then the USA has had a poor harvest and Canada looks like it won’t fair very well, yet Australia is in for a record breaking harvest due to all the rain they’ve had?
I’ve got one trader I deal with saying we should be selling a percentage of harvest 23 because he thinks prices will come down and another trader telling me the market is undervalued.

 

Macsky

Member

Livestock Farmer

Location

Highland

• Aug 1, 2022

• #2

First ship out was maize I heard.

 

super4

Member

Location

Dorset

• Aug 1, 2022

• #3

Macsky said:

First ship out was maize I heard.

Click to expand...

yep and to Lebanon

 

teslacoils

Member

Arable Farmer

Location

Lincolnshire

• Aug 1, 2022

• #4

World s&d is tight, with or without Ukrainian grain.

But it will look a lot tighter if prices drop while fert is dear.

Note the percentage of world stock held by China.

 

PSQ

Member

Arable Farmer

• Aug 1, 2022

• #5

Frontier offering £254 for wheat 'as available'.

But another trader tells me that 'soft group 4' sold north of here this morning for 'this week uplift' at £275, so pantomime season is well and truly underway.

 

M

Mr Tree

Member

Location

Sth Yorkshire

• Aug 1, 2022

• #6

I don’t think it’s undervalued as a commodity it’s just undervalued to our costs of production here.

I think there will be mileage in it long term as the markets realise the ‘worlds barn’ is empty ! Let’s be honest fundamentals haven’t changed but short term I can’t see any uplift .

If your a seller now til October then maybe a difficult decision will have to be made!

I’m having to price til October knowing the same !!

 

Derek67

Member

Location

Northern Ireland

• Aug 1, 2022

• #7

With such commodities incredibley expensive such as gas, coal ect.. And our grain prices so low I wonder how much is grain worth to burn as a fuel?

 

Last edited: Aug 1, 2022

teslacoils

Member

Arable Farmer

Location

Lincolnshire

• Aug 1, 2022

• #8

Derek67 said:

With such commodities incredibley expensive such as gas, coal ect.. And our grain prices so low I wonder how much is grain worth to burn as a fuel?

Click to expand...

iirc 2.5kg produced as many kwh as a litre of kero.

 

marshbarn

Member

Location

shropshire

• Aug 1, 2022

• #9

teslacoils said:

iirc 2.5kg produced as many kwh as a litre of kero.

Click to expand...

It make me wonder why they dont burn wheat in power stations.

 

G

glasshouse

Member

Location

lothians

• Aug 1, 2022

• #10

PSQ said:

Frontier offering £254 for wheat 'as available'.

But another trader tells me that 'soft group 4' sold north of here this morning for 'this week uplift' at £275, so pantomime season is well and truly underway.

Click to expand...

Fronteir are less honest than pikeys

 

teslacoils

Member

Arable Farmer

Location

Lincolnshire

• Aug 1, 2022

• #11

marshbarn said:

It make me wonder why they dont burn wheat in power stations.

Click to expand...

Because they can greenwash taking wood pellets from the USA and burning them. But may find burning UK wheat a bit tricky to sell to the press.

 

Derek67

Member

Location

Northern Ireland

• Aug 1, 2022

• #12

teslacoils said:

Because they can greenwash taking wood pellets from the USA and burning them. But may find burning UK wheat a bit tricky to sell to the press.

Click to expand...

Could be considered carbon neutral!!

 

marshbarn

Member

Location

shropshire

• Aug 1, 2022

• #13

teslacoils said:

Because they can greenwash taking wood pellets from the USA and burning them. But may find burning UK wheat a bit tricky to sell to the press.

Click to expand...

If the people in towns went with out electricity for 48hours they would be demanding that wheat was burned to product electric

 

teslacoils

Member

Arable Farmer

Location

Lincolnshire

• Aug 1, 2022

• #14

marshbarn said:

If the people in towns went with out electricity for 48hours they would be demanding that wheat was burned to product electric

Click to expand...

Nothing can quite mask my disdain for the "general public".

 

ollie989898

Member

Location

Hanging from a twig, in a deep sleep.

• Aug 1, 2022

• #15

With the way things are you need to look at the wider international picture and external events. A lot of uncertainty out there.

 

Derek67

Member

Location

Northern Ireland

• Aug 1, 2022

• #16

teslacoils said:

iirc 2.5kg produced as many kwh as a litre of kero.

Click to expand...

[/QUOTE]
So with kerosene at. 8kg/litre
And today's price at 80p/litre
And taking the figure of 1kg of kero being equivalent to 2.5 kg of grain that leaves a price of £320 a ton if my maths are correct?!