WHEAT

• Reduced US wheat plantings halts price decline

On Monday this week, the United States Department of Agriculture (USDA) published its quarterly US wheat stocks report for 1st March 2025 and its latest update for US farmers planting intentions for the 2025-26 season. Prior to that, both the Chicago Board of Trade (CBOT) and London wheat futures were trading down yet again, both setting new contract lows in the face of plentiful supply and lacking demand.

The US quarterly wheat stocks on 1st March came in at 1,237 million bushels above average trade estimates and above 1,089 million bushels last year, presenting a bearish scene. However, a bullish surprise came from the USDA with a low wheat planted area at 45.35 million acres. This is well below average trade estimates of 46.5 million acres, the USDA Outlook Conference in February which projected 47 million acres, and the final 2024 planted area of 46.1 million acres. US winter wheat accounts for about 75% of the plantings, but the trade estimates were wrong by a similar amount on spring and winter planting.

With a smaller planted area, the US national weekly crop condition ratings (which begin this month) will become increasingly important to watch. Kansas, the primary winter wheat producing state, was unchanged on the week to 30th March at 49% good/excellent whilst other states presented a mixed picture. Texas dropped 5 points to 26% good/excellent, whilst Oklahoma dropped 4 points to 33% good/excellent, significantly below last year’s 73%.

Speculative short covering in future markets after the report was tempered by a significant increase in expected US corn planting intentions, which came in at 95.36 million acres. This is up 4.7 million acres from last year and 926 ,000 acres above average trade estimates. However, CBOT corn futures have lost around 10% of their value since their February peak, which poses the question: will US farmers still be as keen to plant corn this spring?  Old crop US corn is currently the world’s cheapest feed grain whilst US export wheat is now the world’s cheapest at around $230/t FOB.

• Russian prospects turn more upbeat

Russia’s exports may contrast the shrinking US wheat crop as some analysts become more upbeat on prospects for 2025. Recent beneficial rainfall has some increasing their Russian wheat production estimate to as high as 85 million tonnes, whilst others remain at around 80 million tonnes. An increase in the spring drilled area seems to be outweighing the historically poor winter wheat crop conditions that were reported heading into the winter period last year. Russian wheat export prices remain close to their best since harvest around $255 FOB, whilst their export pace slowed to 1.8 million tonnes in March compared to 4.8 million tonnes last March.

• Big jump for EU wheat output

The EU Commission, with an estimated near 15 million tonne increase for 2025 EU wheat production at 126.6 million tonnes, adds to the negative European price outlook. The French wheat condition for the fifth consecutive week remained unchanged at 74% good/excellent which, although above last year’s 66%, is historically poor.

The EU weekly wheat shipments up until 30th March edged higher to 15.68 million tonnes, although are less than two-thirds of analyst targets as we enter the final quarter of the season. Some well-respected market participants believe Brussels’ official numbers are at least 1.5 million tonnes behind actual shipments. Rumoured wheat sales to Morocco and Egypt are not yet confirmed. Romanian wheat prices moved higher as official data puts final 2024 production at 9.29 million tonnes, 1 million tonnes below other trade estimates.

• UK export activity

At Frontier, our teams are busy loading vessels with UK crops to meet demand at various export destinations.

The below photo shows a 6,000-tonne wheat vessel completing in Southampton on Tuesday, with the shipment destined for Ireland.

BARLEY

• Old crop feed barley values stable

With no further sales of feed barley exports for a couple of weeks now and vessels already sailed or covered with supply values in Anglian ports, prices have dropped over the last week. No further shipments are likely unless more farmers have malting parcels to market as feed. There is still buying interest from compounders for May onwards, at values around £154 to £162 ex-farm depending on location in areas away from East Anglia.

• New crop market for feed barley quiet

For farmers concentrating on fieldwork, relatively low prices have kept new crop selling pressure very low. Compound buyers are seeing discounts to wheat of £17 to £19/t and are interested to cover, but only if there is an order from a retailer otherwise they will wait.

• Spring sowing complete

Apart from Aberdeenshire, spring barley sowing is largely complete and farmers are rolling the seedbeds to conserve moisture. While some crops have had rain in the western half of the UK, some fields on lighter land in the East of England could do with a drink in the next two-to-three weeks. Sowing is well advanced in Denmark and Sweden compared to normal. Maltster buying interest is limited, whether this is due to cost-of-living pressures or changes to general demand is unclear, but as the summer approaches this may change.

OILSEED RAPE

Over the past week, the global rapeseed market has been navigating extreme volatility, mostly due to developments in international trade policies and its effects on trade flows.

China's imposition of a 100% tariff on Canadian rapeseed oil imports, effective 20th March, combined with the US tariff on Canadian canola has introduced significant volatility into the market and dramatically altered typical trade flows. This measure by the Chinese government - a response to Canada's earlier tariffs on Chinese electric vehicles amongst other products - has led to increased rapeseed volatility. China, which relies on Canada for over 70% of its rapeseed meal imports, may face shortages by the third quarter, potentially necessitating increased domestic production or a shift to alternative protein sources like soybean meal. The effect on the European market has been pronounced, with the MATIF market dropping €50 in 14 days and regaining almost all of that in the proceeding nine days as traders work out what the realities of tariff implementations are.

In the United Kingdom, rapeseed production has declined to a 41-year low this year with projections for the 2025 harvest indicating a further decrease. With the area expected to fall to circa 244,000 hectares, today’s yield potential is higher than last year which will help make up some of the production decrease from last year.

The European Union's rapeseed production for 2025 is forecasted at 19 million tonnes, around a 13% increase from the current season, attributed to favourable weather and expanded planting areas. Conversely, Ukraine's production is projected to decline to 3.2 million tonnes due to lower plantings. Canada and Australia are looking at slightly smaller planted areas for the new season.

In summary, the rapeseed market is navigating a complex landscape shaped by trade disputes, fluctuating production levels, and evolving global demand. Stakeholders should remain vigilant and adapt to these dynamic conditions to mitigate risks and make the most of emerging opportunities.

PULSES

The UK pulse markets have been struggling for a strong price direction since Christmas, with little change in value since then. There has been export trades in the last month, but the relatively large supply of beans still left on farm has been filling-in this demand steadily. Year on year, there will be less demand into UK feed homes due to the relative expensiveness of beans compared to other cereals and protein sources, but there has been a pickup in demand in the aquaculture supply chain. Today, it looks like the UK needs to find more demand for beans to make sure there isn’t a carryover at the end of the year. The most likely area for that is increased export and it may be necessary for markets to discount themselves to find this demand.

FERTILISER

• Urea/Nitrates

Descending global urea markets have been halted, and values are now slightly increasing. The current Indian tender in play for 1.5 million tonnes is due to close on 8th April, and news of more production issues in North Africa are both contributing to this market uptick. It is also unlikely that China will entertain much, if any, export volume to satisfy current demand. Collectively the current market conditions have pushed up prices both spot and forward by $20 to $25/t. European and UK markets have fallen silent and wait to see the price direction over the next few weeks ahead of traditional summer re-stocking.

Ammonium nitrate manufacturing in Europe witnessed another supplier announce a stop to ammonia production. Achema in Lithuania will halt production on 15th May, with no plans to resume until the third quarter of 2025. This decision, like others, is due to volatile natural gas prices and cheap imports from Russia. The UK typically imports over 100,000 tonnes of lithan, therefore, the tight supply we see here today with AN looks set to potentially continue beyond the summer.

EU and UK officials are also looking at a proposal to implement a tariff for fertiliser products out of Russia and Belarus into Europe and the UK. If approved these tariffs will be introduced on 1st July 2025 and would be on top of the current 6.5% duty. It's unclear what the effect would be but it’s likely to increase prices over any June offers.

Buying crop requirements early (between June and September) has paid off given the tight supply of physical product since January, and not being caught up in the logistical bottle neck causing delivery issues.

Geopolitical situations, sanctions, uncertain energy costs, tariffs, and potentially less imports all point to growers securing product early in a narrow window when markets reset. Frontier can guide growers when this happens; providing support to identify the right risk management options for the farm business as well as offering Nitram for spot delivery subject to location.

• UAN/Liquid

Continued settled conditions are allowing growers to apply product to meet crop demand. With the pace of applications and increased demand from both cereal and root growers, growers are encouraged to request delivery as soon as they have tank capacity to avoid delays.

Growers using UAN have access to a full range of nitrogen, nitrogen sulphur and NPK grades, applied to maximum sprayer widths, which is leading to increased interest in conversions for crop ‘26.

The Urea Stewardship Scheme is now in place in England. In order to remain compliant, growers using UAN must include a urease inhibitor, such as Limus® Perform, within applications for the rest of the season. Product is available for prompt delivery from our crop protection stores across the UK.

Straights/PKs/NPKs

Supply problems with imports are very evident in the UK, causing delays in physical deliveries to farm.

Phosphates (DAP/TSP) have been delayed into the UK due to sea conditions at Moroccan ports stopping ships loading on time, with many waiting 10 or more days to get through the congestion. This isn’t ideal timing given the high demand in Europe and the UK.

Potash demand is higher than expected led by lower pricing, resulting in pressure on UK stocks and delays on importing replacement. The stock situation should improve over the next 14 to 21 days, allowing for current order books to be delivered by late April into early May, and prices remain firm for both nutrients.

Please speak to your local Frontier contact or email us at info@frontierag.co.uk for more information or advice related to any of the topics and services mentioned in this report.

To be notified each time this report is published in the future, you can also subscribe to ensure you always have the latest market insights - just complete the form below.