Currencies

This week has been slightly better for the £, making small gains against both the $ and € following last weeks dip as investors saw a buying opportunity.

The fuel situation and now added press coverage on inflation fears and household incomes will unfortunately keep the £ in check for some time yet, stuck in that continued range of around €1.17 and $1.36.

Wheat

Wheat continued to rally following the USDA report at the back end of last week. Figure which came through put US wheat stocks at a 14 year low, 48.4 MlnT, against trade expectations of 50.4 MlnT. Coupled with this news were reports that Russia is considering a season export cap of 31.5 MlnT when the global market usually looks to them to secure around 35 MlnT.

On the flip side though, Europe revised their figures up by 3.8 MlnT this week and announced that Algeria (one of the main homes for some European wheat), has downgraded their parameters to ensure they can continue buying from historic suppliers. UK wheat is currently the cheapest option for both Spain and Ireland which does not support prices coming lower, unless Matiff does.

Essentially if we are to see any correction and an end to this current uptrend, we need to see good results from the Southern Hemisphere harvest when that starts in the coming weeks. Most of the UK market appears covered through to Christmas so domestic trade is slow but there are big gaps come the new year.

Maize is seeing plenty of harvest pressure with the US approx. 18% harvested, ahead of their 5 year average and with Brazil now talking about a record 32 MlnT crop, the long term view for maize does look more settled than wheat.

Soya

Soya has continued to trend lower on Chicago although the impact of this on our UK prices has been minimal with a mix of the low £ and the continued freight issues.

UK shippers are eagerly waiting the arrival of their Nov new crop vessels and there are concerns that there could be a gap come the end of October.

Looking ahead though, Brazil are still working off a record 144 MlnT crop for this coming season and although it is a long way off, if it comes anywhere near close, then we should see soya reach back down towards the £300 per tonne mark, somewhere it has not been for over 12 months now.

Organic Markets

The organic markets for this coming winter continue to move up at an alarming rate. Organic cereals across Europe and the Baltic region are tight and there has been a portion which has been sold as conventional because premiums were still too low. This coupled with the ongoing logistics challenges, has seen grain move up circa £40 per tonne in the space of a month.

Proteins remain the biggest area for concern with the supply chain unsure if they will be able to secure the container freight to supply Europe from homes such as China and India. There are still questions over India’s crop and if they will even actively come to the market to sell which would see the UK switch their reliance to Chinese material, something which has not been the case before and comes with its own uncertainties.

The mix of uncertainty over volumes and ongoing freight issues have seen soya move up to over £1000 per tonne for new crop.

To read the complete Organic Markets report, click here.

And Finally…
‘Pooh Sticks’ bridge in East Sussex made famous by children’s books is bought for £131,000.

The famous wooden structure in Ashurst Forest, east Sussex attracted bids from all over the world but was won by UK based Lord De La Warr. The bridge had been where AA Milne had created the game with his son, Christopher Robin which was later included in the wonderful Winnie the Pooh children’s books.

The Earl already owns the ‘Hundred Acre Wood’ close by, and plans to re build the bridge somewhere on the estate to preserve its memory for future generations.

Regards,
Kay Johnson & Martin Humphrey