Monday Market Briefing - 7th August 2023

Finally, we have a dry week in prospect for harvest to get up to full speed. We expect there will have been some damage to crops from last week’s rains so storekeepers have an important job this week segregating the better material for safe keeping. Spot opportunities for immediate delivery have been slow to appear so far, there was plenty of old crop around to fill the gap for a while, but the UK consumes at least 250,000mt of wheat each week all year round so a shortage of available dry grain might soon start to exert an influence especially if farmers generally remain slow sellers at current price levels.

It will be worth keeping in touch for the latest bids if there’s a crop you might want to move out, the sampling team are at the ready, don’t hesitate to ask for a visit this week to get a quick check on harvest quality - even if a later visit post-drying is required - that early snapshot can be really useful.

Forward markets still lack any real direction. With harvest prospects taking shape, the war becomes the main driver again. It appears that the relative stalemate on the ground has prompted both sides to look for other targets. The ability of Ukraine to successfully strike ships outside the key strategic port of Novorossysk is potentially very big news and it did cause a ripple in markets on Friday. A successful blockade of Russia’s biggest grain export facility would certainly be a game-changer but it’s not yet clear how easily these strikes were achieved and hence how likely they are to be repeated.

Right now you can sell Nov 23, Nov24 and Nov 25 all at the same price, which is actually not such a bad idea if you want to lock into some long term value and create some certainty in your budgets, but it’s very unusual and sums up the markets lack of conviction about what lies ahead.

Have a good week.