Currencies
We saw a slightly more supported £ this week with employment data released on Tuesday looking positive but this was limited with both the Bank of England and European Central Bank die to meet this week to discuss interest rates again.
Currency is also not being helped by the uncertainty over increased Covid measure and even if we do not have a direct lock down, whether the public will impose almost a self lock down and stop visiting bars, restaurants etc.
Wheat
Wheat prices continue to look relatively flat compared to recent weeks and now seems to be feeling the traditional pre Christmas lull in trading.
Last week we saw the USDA revise stock figures, using an increase in production from Australia, Canada and Russia, but questions are now being asked about the demand figures used in the report which could mean we see a correction in January which would push prices higher again.
In terms of the technical aspects of wheat, UK wheat is now ever so slightly expensive against Matiff, something which has not been the case for many months now. This means that if Matiff moves lower, the UK markets would also likely track that change. Current support level which the trend is testing is around £225 but if we break that, the next level could then be sub £220 in the short term.
Soya
Despite a neutral USDA report, soya continues to move higher with large amounts of spec money invested in both beans and meal.
The long term prospects for soya still look favourable with Brazil further upping their estimates to 142.8 MlnT.
There is caution over the la Nina dry weather across South America but so far, conditions are more than favourable for the current stage of the crops.
Organic Markets
Nothing has changed in the organic markets this week. There are still no new offers for grain at origin.
For proteins, to add to the questions over supply from India and these smaller decertified bodies, we now have supply issues from China to deal with. For Q2 onwards, Chinese material is pricing better than Indian origin, however, because of localised Covid lockdowns, we have a situation where boats are waiting to be loaded and there is no material to load them with because it is stuck in factories within lockdown zones!
And Finally…
From all of us at Humphrey Feeds, we wish you a Merry Christmas and a Happy New Year!
Regards,
Kay Johnson & Martin Humphrey
