The Agriculture and Horticulture and Development Board (AHDB) is reporting that world grain markets felt some support last week overall.
US and European wheat markets found strength from concerns on whether there would be an extension of the Black Sea Initiative (Ukraine export deal) which was due to expire last Saturday (March 18), but has now been extended.
Meanwhile, Chicago maize found support from strong Chinese demand. Where the financial markets are concerned, concerns grew with the US dollar weakening, to some extent, over the past seven days.
Global grain markets
Meanwhile, the Black Sea Grain Initiative has reportedly been extended for 60 days. This is half the time that the deal has been previously renewed for. However, the news did act to steady some concerns on global supply.
According to AHDB, the new deal should allow the safe export of Ukrainian grain over the coming weeks.
Strong demand helped to support global grain prices last week. Wheat was purchased by Algeria (540Kt milling wheat), Tunisia (234Kt soft wheat) and Jordan (60Kt milling wheat) during the period.
Where US maize is concerned, private exporters recorded 2.111Mt of ‘flash’ sales of product to China for delivery over the coming months
New-crop conditions remain the key focus going forward. Reports of frost and cold conditions in the US over the weekend are being investigated.
Some analysts have trimmed their outlook for EU production of soft wheat and exports for this season (2022/2023) and next season (2023/2024).
New season soft wheat production is now pegged at 129.5Mt, down from 129.7Mt in February’s forecast, but higher than this season’s crop, now pegged at 125.1Mt.
Despite recent rains in western Europe, levels had not been sufficient to fully remove long-term drought risk, particularly in France and Spain.
For soft wheat exports from the EU, these are now pegged at 30.0Mt for this season (2022/2023) and 30.3Mt for next season (2023/2024), down 100Kt and 300Kt respectively from February’s forecast.
UK feed wheat futures saw pressure last week, despite US and European wheat markets seeing support.
For old crop prices, futures fell £5.50/t last week, to close on Friday at £209.50/t. New-crop prices fell only £1.30/t over this period, to close on Friday at £218.20/t.
Meanwhile, sterling found some support last week, closing higher against the euro (up 1.06%) and US dollar (up 1.22%).
It is also worth noting that the UK has large wheat availability this season and, accordingly has been setting a strong  export pace, according to the AHDB.
The latest trade data confirm that UK wheat exports hit a 40-month high in January 2023.
