The May wheat futures have spent the week moving slightly up from the recent lows of £157/T at the start of the month and the position is currently trading at £164/T. 

The November futures are currently trading at £148/T - almost unchanged from our last report.  Traded volumes are negligible with any change attributed to the daily changing view of and its continued effect on currency.  The differential between old and new crop wheat is still to be corrected.  The UK supply is considered to be tight, however, the May UK wheat features continue to follow the French Matif, so it is important to remember that EU exports have increased and if they continue at this level, it could cause an already tight supply in Europe to run out before the new crop arrives.  News for the new crop is currently favourable from recent weather reports but there is still a long time to go before harvest.  The continued volatility of currency from Brexit negotiations adds to the uncertainty of potential unpredictability of forward positions in our markets.

US cereal prices drifted higher this week, and reports showed that 300 Mln T of US maize has been exported to China.  This was a significant purchase given the total bought for the 2018/19 season has been 166 Mln T.  The trade is currently holding a record short position which could cause some buyers to take further cover in the short term, and added strength to all the US cereals.  China has reportedly stopped buying canola completely from Canada due to trade disputes over telecoms technology.  This is also being seen as an opportunity for the US and taking a much wider effect on all of the agricultural commodities.  Expectations are that the 2019 world wheat crop will be larger than demand, but that stocks in Russia and the EU will be low following the previous poor season.  This is giving the US a positive feeling for Wheat despite the current continued competition for feed use with the relatively low price of maize. 

The May soya bean prices traded lower at the close of the week, linked to a drop in Crude oil, which was thought to be related to weak expectations for the world economy - especially in Europe.  However the week’s movement was generally sideways for soya bean and slightly up for soyameal.  Overall, the longer term trend is still down from the highs seen in December, as talks of larger supplies in south America, low Chinese demand and higher supplies next season from other producers are collectively likely to limit price increases.  The US dollar was stronger, as its economic prospects look relatively buoyant, so again currency holds a strong influence on this market.

There are many times that nature has inspired human designs, one example was the Japanese bullet train.  These trains were becoming so fast that they were causing a loud `boom’ as they exited typical train tunnels.  A cushion of air was building at the front of the train at 300km an hour and disturbing both people and wildlife when creating that boom on exiting the tunnel. 

An engineer, with an interest in bird watching, noted that when kingfishers dive, the water is hardly disturbed.  They applied the long pointed beak into the model for a new nose for the train, which not only prevented the booming noise pollution, but also save between 10-15% energy due to the increased aerodynamics.  This copying nature is know as `biomimicry’.