UK wheat prices have edged higher in recent days, tracking world markets that lifted in the face of weather concerns for 2025 wheat production. Helped by sterling weakness, London 2025 crop wheat futures rose to their highest since the end of last month although old crop prices struggled to match that level of interest.
Lack of consumer demand leaves 2024 crop futures with little buying interest, even though prices are not much more than £4 above the contract low. UK feed wheat prices remain too high to compete for exports and buying interest is thin for the shipping trade too.
WHEAT
- Wheat prices edge higher
UK wheat prices have edged higher in recent days, tracking world markets that lifted in the face of weather concerns for 2025 wheat production. Helped by sterling weakness, London 2025 crop wheat futures rose to their highest since the end of last month although old crop prices struggled to match that level of interest.
Lack of consumer demand leaves 2024 crop futures with little buying interest, even though prices are not much more than £4 above the contract low. UK feed wheat prices remain too high to compete for exports and buying interest is thin for the shipping trade too.
UK customs data shows wheat imports for the period July 2024 to January 2025 totalling 1.96 million tonnes, with about three quarters of that coming from the EU. With that in mind, old crop price potential remains limited. Offering some support is the widening gap to 2025 London wheat futures; the May 2025 to November 2025 gap now out to more than £15 per tonne, although commercially that carry isn't sufficient.
New crop is supported by uncertainty over production potential for the US and Black Sea regions and it is worth noting that wheat crops in Spain are enjoying more rainfall than wheat crops in the UK.
- US weather triggers short covering
Adverse weather last weekend through the US Southern Plains triggered some element of short covering earlier this week, taking Chicago Board of Trade (CBOT) wheat futures up to their highest since the end of last month. Tornadoes and dust storms, coupled with near record high temperatures for the time of year, contributed to soil moisture concerns.
27% of the US winter wheat area was in drought last week - double last year's amount and expanding. Kansas winter wheat condition ratings fell again during the week ending 16th March to 48% 'good/excellent' - down from 52% the previous week - although this rating is above average for the time of year.
With crops breaking dormancy, weather is key over the spring period and the United States Department of Agriculture (USDA) will begin to publish weekly crop ratings for winter wheat from the beginning of next month. With the increased USDA estimate in the planted area, some currently see potential for the largest US wheat crop for nine years.
- EU shipments continue to weigh
EU weekly wheat exports up to the 16th March were a respectable 634,000 tonnes, but the current cumulative total of 14.921 million tonnes is eight million tonnes behind last year and continues to pull down EU old crop wheat prices. The accuracy of these numbers is currently in question, with figures published by Brussels showing the UK as being third in its list of buyers, having taken 1.053 million tonnes. UK customs import data shows that 1.471 million tonnes of wheat came from the EU from July 2024 to January 2025, highlighting that Brussels is clearly understating the pace of EU exports. Nigeria is the primary EU wheat customer having taken 2.175 million tonnes, followed by Morocco at 1.7 million tonnes.
China has come to France for its wheat supplies in recent years, providing a price tonic, but is currently noticeable by its absence. Chinese agricultural import data shows that the country's January to February 2025 wheat imports were just 110,000 tonnes - 96% down on last year. Corn imports were only 180,000 tonnes down, which is 97% down on the previous year. Earlier this month the USDA trimmed its China wheat import estimate by 1.5 million tonnes to 6.5 million tonnes, less than half of the amount it took the previous season.
BARLEY
- Export provides old crop feed barley support
Feed barley prices have received some support in the last week. Whilst domestic demand for old crop feed barley remains weak, with consumers mostly covered in the nearby, further export sales have been made for the spring months. This will provide some respite, at least in the short term, from the recent falling feed barley markets.
- Good progress on spring drilling – eyes on the weather
There will be little to no demand on old crop malting barley until July at the earliest. Looking ahead to new crop, drilling progress has been very good in the UK and elsewhere, with the Scandinavians also making early progress. As always, attention will turn to the weather in the coming weeks as the last of spring drilling concludes and eyes turn to crop establishment.
OILSEED RAPE
- World tariffs take their toll on rapeseed values
Rapeseed values have dropped over the last few weeks, as varying world tariffs affecting oilseeds and their products have reduced confidence levels for all participants in the market. Current tariffs between Canada, the US, China and Europe are rapidly changing trade flows and the attractiveness for processing in each region, leading to this reset in values.
As the biggest importer, the EU is suffering from the highest levels of volatility in MATIF rapeseed futures. There has been an increase in new crop values relative to old crop, with traders pointing to plentiful European supply as Canadian seed flow increases due to tariff changes. As prices have decreased, rapeseed oil has become more competitive versus other vegetable oils. This may help buy more demand in a market which previously looked like it was going to crush lower tonnes year-on-year.
Globally, rapeseed crops for 2025 look positive. Many expect a larger global crop for the coming season in comparison to last year, although if these lower prices persist plantings may suffer in Canada.
In the UK, the planted crop is showing some promise and if growing conditions remain favourable, we can expect a crop closer to last year of around 800,000 tonnes.
PULSES
The pulses market continues to trade in a narrow range, with prices around £210 -£215/t ex-farm for feed beans.
- Feed beans
Small volumes of domestic demand remain but are getting filled in quickly despite beans holding value and make them expensive against the likes of rape meal, reducing demand for beans in compound feed rations.
Export remains steady, with the UK far behind previous years. It's unlikely we will catch up due to reduced demand in the market. There continues to be a good farm supply, suggesting that there is still a reasonable tonnage unsold. If this is the case, it will cause a carry over for the UK.
Very little has been traded for new crop with beans continuing to look expensive, meaning the reduced demand will carry into crop '25. There is currently an uncertainty around spring cropping due to the changes around SFI. This will be contributing to the lack of farm selling for 2025.
- Human consumption beans
The UK human consumption bean market has almost finished for the season, but bulk shipments continue at a fast pace out of Australia which is causing an oversupply of the Egyptian market. South Australia continues to be very hot and dry, which is having a negative effect on autumn and winter crop sowing. This will be one to watch going forward.
FERTILISER
The UK fertiliser industry is under pressure due to later demand and an unseasonably high rate of purchasing through January and February 2025. The pressures are not just restricted to the UK market as other market influences, such as gas prices, sanctions, threats of tariffs, new EU duties on Russian exports and ongoing geopolitical situations are impacting global markets. Coupled with a rise in global demand for crop nutrition products this is culminating in supply issues and delays, worldwide.
- Urea/nitrates
Urea values in the US and Brazil have eased slightly and the lack of commitment or direction from the long expected Indian tender is contributing to uncertainty around urea pricing globally. European demand remains sluggish - along with little change in pricing in the UK - amid tighter supply for this current season. UK demand for untreated urea has recently decreased as we approach the deadline for application to crops without an inhibitor, to adhere to the Urea Stewardship Scheme (England only) from the 1st April onwards.
Pricing on nitrates (CAN/AN) across Europe remain firm, with shipping /vessel delays further tightening supply and pricing levels. UK AN production continues to offer a constant supply of good quality product to UK growers, avoiding logistical delays to the farmgate for April/May delivery. Please speak to your Frontier representative for more details.
- UAN/liquid
UAN users have access to a full portfolio of nitrogen and nitrogen sulphur grades for prompt delivery. However, as settled weather conditions persist across most of the UK and UAN applications continue at pace, growers are advised to give 72 hours notice to avoid pinch points in deliveries. UAN values remain unchanged at present, still showing growers a competitive p/kg offering against solid alternatives.
Growers with additional product requirements this spring should contact their Frontier representative to discuss top up volumes along with their urease inhibitor requirements. All UAN growers are encouraged to include a urease inhibitor, such as Limus® Perform throughout their liquid fertiliser programme; the benefits of using Limus® Perform include an improved nitrogen use efficiency (NUE) of up to 7% through reducing ammonia emissions by up to 98%, and in England remaining compliant within the Urea Stewardship Scheme from 1st April.
- PKs/straights/NPKs
Despite reports of the US delaying or reducing tariffs on Canadian potash, the market remains firm amid production cuts in Belarus and Russia affecting trade flows and pricing levels. It is therefore likely that the UK market will see further price increases on potash as we move towards April and spring demand continues.
Phosphates markets also remain firm, with a combination of currency holding, low supply and high demand all contributing to maintaining the strong pricing levels we are experiencing. It is worth considering a compound NPK range, as an alternative to blended PKs/NPKs, where product is available at UK sites for April delivery.
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