Monday Market Briefing - 7th September 2020

Last week the major wheat exchanges failed to push through recent highs but showed no real signs of weakness ending close to unchanged - there is still enough international buying interest to keep things going. Over the weekend, the Government’s Brexit narrative hardened ahead of another round of negotiations. Renewed talk of no deal placed the Pound under pressure on Monday, which in turn led to a firm opening for LIFFE. With no major news expected this week we should see the buying interest keep things bubbling and a positive week is in store.

But the fact is, we are heading into the busy autumn period with the UK’s tariff position unknown beyond 31st December. This might not directly affect our wheat markets, where the small crop means we don’t need to export anything this year, but it does have implications for barley where we have a large surplus of material, much of which would normally find its way into Europe. There are two outcomes possible; either we do get a deal and the Pound rallies , hitting prices – or we don’t get a deal and tariffs are imposed, hitting prices.

Fortunately, the mixed fortunes of the barley crop across the UK and Europe do appear to have created some opportunities, our sampling data shows a broad range of proteins and as the market takes shape all of these will have value. There is a substantial export and domestic program available pre-Christmas. Malting premiums now on offer are worth grabbing, so speak to your farm trader and see which route your sample best suits. If you had some rain affected barley late on, ask for another visit from the samplers and check it over. It costs nothing and it’s worth getting it right. If it is feed, values have improved from harvest lows. We’re here to help.

Have a good week and stay safe.