UK FEED wheat values are slightly improved this month with prices for spot collection currently trading in the region of £120/T ex-farm.

For those of you looking to secure movement for next spring, £125/T ex-farm is offered for April collection.

The recent price rally has surprised come as a surprise to much of the trade and has been well received by local farm sellers, particularly given that the wheat market looked as though it was to be imminently heading towards the £100/T mark.

Physical supply and demand is currently unchanged, despite the recent increase to local ex-farm values.

Global wheat production for the current 2014-2015 trading season is forecast in the region of 720 million tonnes, almost 65 million tonnes higher than the 2012-2013 trading season.

Europe alone accounts for more than 155 million tonnes of this tonnage, the largest production total on record.

Currency fluctuations are therefore responsible for the recent price rally; a weakening of sterling against both the Euro and US dollar has allowed UK grains to effectively compete in a global marketplace, increasing our local ex-farm values.

Looking ahead, market attention is now beginning to shift towards the upcoming Southern Hemisphere harvests, the majority of which appear to be on track for an above-average harvest also.

Twenty-four million tonnes-worth of Australian wheat should enter the already over-supplied market place in the New Year, potentially adding pressure to UK wheat values.

Wet weather could be causing problems in South America, particularly in Brazil where “inadequate soil moisture contents” are making it difficult for farmers to plant this season’s soybean crop.

This initially encouraged OSR values towards the £250/T ex-farm position for pre-Christmas collection, but prices have since come under pressure. £245/T ex-farm currently looks like a realistic offer.