The latest episode of FeedCast is brought to you by Chris Davidson, our raw material expert. As usual he provides an outlook on the protein, mid protein and cereal markets.
Starting with a general overview of the markets, we have seen the markets move away from South America to focus on North America plantings, whilst more locally, we are still focusing on the weather and as always looking at the situation in Ukraine and Russia.
Wheat has bounced away from its lows and looks to being trying to find a foothold in the market, especially after the scare of the dam destruction in Ukraine. We see Russia aggressively saying they see no reason for an extension of the grain corridor when it concludes in July. The uncertainty around whether we will have access to Ukrainian grains at new crop remains an remains a significant upside risk, with this week’s events a reminder of how fragile the situation remains.
The US are starting to produce weekly ratings on the progress of the crops on a more regular basis. Plantings are progressing well across the board, but there are a few concerns. Winter Wheat conditions show a slight improvement but they still remain very low, but the biggest surprise was around Maize and Soya, with first condition ratings being well below what the market was expecting and being at the lowest starting point since 2019. It is very early days so is by no means a red flag, but something to note.
Soya has found a level as it hasn’t continued to fall too much further and as we stand is sitting very much in a trading range. Soya is around £410-420 delivered right through to April 24. There is a potential to see some weather concerns over the coming months which may affect pricing. However, certainly for the time being, it's worth making sure you have your Soya covered for at least the first half of the summer. It would also be beneficial to look at a percentage of next winter as there is a risk of some upside if the weather starts to turn against us.
Sticking with the proteins, Rapemeal has previously felt quite cheap and was commanding some demand. As a result of this we have seen some tightness meaning for June and July it is a struggle to buy the product. Even on the resale market it is almost impossible to buy a single load. This is partly driven by demand but also due to the fact that the demand for oil is poor. We would highly recommend looking for alternatives for June/July such as Vivergo which is readily available. As we move forward to new crop we are already seeing the northern market tighten significantly. If you are wanting to book for Aug-Oct Erith is by far the best buy however this could increase in the not too distant future.
Two key takeaways are that we are keeping an eye on the US weather and monitoring the situation in Ukraine particularly with the recent explosion and the subsequent flooding.
As always get in touch with your sales representative or contact us in the office if you have any queries.
Legal Disclaimer:
Please note: The information provided during this podcast has been prepared for general informational purposes only and does not constitute advice. The information must not be relied upon for any purpose and no representation or warranty is given as to its accuracy, completeness or otherwise. Any reference to other organisations, businesses or products during the podcast are not endorsements or recommendations of AB Agri or its affiliated companies. The views of the presenter are personal and may not be the views of AB Agri. The contents of this podcast are the copyright of AB Agri.
Continue reading...
Starting with a general overview of the markets, we have seen the markets move away from South America to focus on North America plantings, whilst more locally, we are still focusing on the weather and as always looking at the situation in Ukraine and Russia.
Wheat has bounced away from its lows and looks to being trying to find a foothold in the market, especially after the scare of the dam destruction in Ukraine. We see Russia aggressively saying they see no reason for an extension of the grain corridor when it concludes in July. The uncertainty around whether we will have access to Ukrainian grains at new crop remains an remains a significant upside risk, with this week’s events a reminder of how fragile the situation remains.
The US are starting to produce weekly ratings on the progress of the crops on a more regular basis. Plantings are progressing well across the board, but there are a few concerns. Winter Wheat conditions show a slight improvement but they still remain very low, but the biggest surprise was around Maize and Soya, with first condition ratings being well below what the market was expecting and being at the lowest starting point since 2019. It is very early days so is by no means a red flag, but something to note.
Soya has found a level as it hasn’t continued to fall too much further and as we stand is sitting very much in a trading range. Soya is around £410-420 delivered right through to April 24. There is a potential to see some weather concerns over the coming months which may affect pricing. However, certainly for the time being, it's worth making sure you have your Soya covered for at least the first half of the summer. It would also be beneficial to look at a percentage of next winter as there is a risk of some upside if the weather starts to turn against us.
Sticking with the proteins, Rapemeal has previously felt quite cheap and was commanding some demand. As a result of this we have seen some tightness meaning for June and July it is a struggle to buy the product. Even on the resale market it is almost impossible to buy a single load. This is partly driven by demand but also due to the fact that the demand for oil is poor. We would highly recommend looking for alternatives for June/July such as Vivergo which is readily available. As we move forward to new crop we are already seeing the northern market tighten significantly. If you are wanting to book for Aug-Oct Erith is by far the best buy however this could increase in the not too distant future.
Two key takeaways are that we are keeping an eye on the US weather and monitoring the situation in Ukraine particularly with the recent explosion and the subsequent flooding.
As always get in touch with your sales representative or contact us in the office if you have any queries.
Legal Disclaimer:
Please note: The information provided during this podcast has been prepared for general informational purposes only and does not constitute advice. The information must not be relied upon for any purpose and no representation or warranty is given as to its accuracy, completeness or otherwise. Any reference to other organisations, businesses or products during the podcast are not endorsements or recommendations of AB Agri or its affiliated companies. The views of the presenter are personal and may not be the views of AB Agri. The contents of this podcast are the copyright of AB Agri.
Continue reading...