November wheat futures finished the week on a gain, after a slower week of losses, finishing at £176.35.  Support was provided by Coceral’s cut to the UK wheat number to 13.6 Mln T from their previous forecast of 14.4 Mln T in June, and then further support today from the weakness in Sterling following the cold shoulder given to Prime Minister in Europe on Thursday .  The £ had strengthened for most of week, but the rejection of the Chequers plan by EU leaders has seen Sterling’s gains wiped back down to 1.1134 against the €.

News that Vivergo biofuels plant is closing has sunk in and assuming it uses 480,000t of domestic wheat, then the UK’s S&D for wheat has been sorted.  This infers that we should not to have to import much wheat, particularly with all the maize imports we have already contracted.  However, a different dynamic applies to Europe and the rest of the world (as they are more affected by the smaller global harvest); as our markets are closely connected, so we could still see volatility from wider world pressures driving the UK wheat market. 

Chicago wheat lifted at the start of the week, but ended with flat trading in recent days.  Despite some positive news on corn exports, wheat exports are still behind expectations of the USDA and funds continue to hold relatively short positions on wheat.  Australia is still forecasting little rain in the main wheat growing areas over the next two weeks, yet this is the time where rain can positively affect yields.  Russia's Sovecon consultancy cut Russia's 2018/2019 wheat export forecast to 33 Mln T (down 0.9 Mln T) alongside IKAR cutting the 2018 Russian wheat production from 69.6 Mln T to 69.2 Mln T.  Trade speculation about restrictions to Russia’s export restrictions continue to be met with official denials.  However shipments from Russia have been slowed this month following the introduction of more stringent quality tests – reported to be in response to customer complaints.  With world 2018 supplies tight it feels as if  prices could rally again. 

Soya bean meal prices continue at lower levels, although there have been modest gains in the last few days of trading following rumours that Argentina may increase export taxes to increase their revenue.

US soya bean prices continue to be depressed by the US/Sino trade wars, but that is causing price resistance in the short term with US farmers.  It is hoped that active buying of US soya bean could help ease the price depression. The US/Brazilian price gap continues to widen beyond the 25% tariffs.  EU uptake of US imports is up 133% compared with 2017.  A report by CHS Shanghia Trading Co. has indicatd that there were not enough soya alternatives available between October and February and 6-10 Mln T of US soya bean may be required for their needs, which seems unlikely as China is not buying US Soya.  There was a curious report that China had bought up to 6 cargos of Argentine soya beans, which was matched by reports of a similar number of US soya beans cargos being bought by Argentina.  With a replacement price low enough without tariffs, to allow a good crush margin on the US beans, could this be a way for China to beat the tariffs?  $ weakness has triggered heavy fund buying driving the gains seen. 

How would you like an egg price of between £408,000 and £2 million for each egg!  Japanese scientists have created just this using a genome editing technology to create hens that lay eggs containing high quantities of the natural anti-viral protein human interferon beta, known to treat serious diseases such as cancer and hepatitis.  The protein can be seen as noticeably cloudier whites. 

The individual egg’s value is measured by the level of proteins (ranging from 30-60 mg) and with the current 20 human interferon beta egg producing hens seeming to be healthy, with a normal lifespan and laying eggs constantly like normal hens this could prove a science to watch and make eggs a real life saver!