Gleadell Market Report
Immediate - 3 December 2015
David Sheppard, Gleadell’s managing director, comments on the wheat market
The picture has been the same for many weeks now, with too much wheat chasing limited demand. Added to the mix is the prospect of Argentina freeing up wheat for export, with its new government promising to slash export taxes. In addition, Brazilian feed wheat is being offered to Asia in Panamax vessels at lower prices than UK or French origin. Last season the UK was a main beneficiary of export business to Asia, so new competition in this direction is not welcome.
UK export activity has picked up recently but remains well behind the rate required to remove our surplus. A similar scenario is seen in the EU, Russia and most markedly in the USA.
Mild weather across much of the Northern hemisphere has left winter drilled crops in good condition but with almost zero snow cover. Therefore a sudden extreme cold snap could result in winter kill – especially in Russia and Ukraine. At present conditions remain mild and no immediate threat is seen.
The fall in sterling against the euro, following the European Central Bank’s announcements regarding deposit rates and quantitive easing, has given some nominal support to UK prices – but buyers don’t seem keen to follow slightly firmer futures markets.
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Jonathan Lane, Gleadell’s trading director, comments on the OSR market
There is still very little farmer selling across Europe, Australia and elsewhere, but with crushers’ margins being so poor the market remains in a big stand off. EU crushers only have margins in the spot positions.
In South America the weather is still of concern for soyabeans - too wet in some parts, very dry in others. Funds covered around 800,000t (about one sixth) of their soybean short positions on Wednesday (1 December), with soybean oil firming and meal also attempting to turn higher.
In summary we need to keep watching the US soybean market; it offers a glimmer of hope.
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For market information contact Jonathan Lane, trading director, on 01427 421221 or
Press queries or for further Gleadell contacts call Robert Harris Communications on 07768 402850 or
Notes to Editors
Gleadell Agriculture Ltd is an independent major trader of grain, seed and fertiliser in the UK with offices in York, Hemswell (Lincolnshire),Swaffham(Norfolk), Stamford (Lincolnshire) and Warminster (Wiltshire).Gleadell is jointly owned by ADM and InVivo, the leading provider of agricultural goods and services in the EU.
Any prices quoted in this release are indicative only at the time of going to press and subject to location and quality.Although Gleadell takes steps to ensure the validity of all information contained within this release, it makes no warranty as to theaccuracy or completeness of such information. Gleadell will accept no liability or responsibility for the information, or any action or failure to act, based uponsuch information.
mln t = million tonnes, t = metric tonnes, kg/hl = kilogram per hectolitre.