Click to contact us or call 02476 353537

July 27 Gleadell grain market report

Over the past week, grain markets have seen much volatility, mainly moving higher on falling US crop ratings and declining Black Sea prospects.

Jonathan Lane, Gleadell’s trading manager, comments on grain markets …


> USDA reports US wheat harvest 82% complete, 80% last week – SRW harvest complete with HRW harvest 93% complete.

> Excess ethanol credits may dampen demand for corn – USDA may be overstating ethanol demand for 2012/13 by as much as 10%.

> US corn sowings could hit 100mln acres next year, as historically low stocks intensifies the ‘battle for acres’ for 2013/14.

> The Russian ministry estimates 2012 grain crop at 80-85mln t – unchanged from previous estimate and above analysts views.

> French wheat yields continue to beat forecasts, with some estimating the crop at over 36 mln t.

> USDA reports corn crop in good/excellent condition at 26%, down 5% points on the week – rainfall is forecast which may reduce further losses, although most pundits think that the damage done to date is irreversible.

> US corn yield is estimated at a 10-year low as drought expands – average analyst estimate of 130.8bu/acre against current USDA projection of 146bu/acre.

> Kazakhstan’s Ag Ministry cuts its grain crop forecast for 2012 to 12.8mln t – exports at 10mln t compared with 12.1mln t last season.

> EU grain yield outlook is hit by continued dry weather in southern and south east Europe – MARS lowers EU soft wheat yield to 5.57t/hectare.

> Australia’s 2012/13 wheat crop projected at 25mln t by Rabobank, down from the record 29.5mln t last crop year.

> Heat reduces corn prospects in Eastern Europe – Hungarian and Romanian crops damaged by dry weather – lower yields.


Over the past week, grain markets have seen much volatility, mainly moving higher on falling US crop ratings and declining Black Sea prospects. US corn ratings fell another 5% points to their lowest level since 1988, as drought conditions expand. With the likelihood of another yield cut by the USDA in August, US stocks will be historically low at the end of this season, igniting the ‘battle for acres’ debate for the 2013/14 planting season.

The bullish trend was sharply interrupted earlier this week, as an improved weather outlook for the US led to heavy selling. The market’s reaction to the improved forecast anticipated that soybean condition would improve with rain, and that while storms will not boost corn prospects, they could stabilise the losses. In addition, mounting Spanish and Greek debt concerns sent the Euro to a 2-year low against the US$, raising further concerns over global economies and future commodity demand.

In summary, market fundamentals remain bullish but, like all bull markets, they need continuously feeding. Any change of sentiment, in whatever form, leaves the markets open to profit-taking, and the recent ups and downs we have witnessed this week are likely to continue.


Willie Wright, Gleadell’s Oilseed Trader, comments on the markets …


> Soybeans, which have been the market leader in oilseeds, have once again posted a cycle high in the last week in July. This time it would be fair to say that it wasn’t all down to longs capitulating or rain arriving in the US Midwest, but as much to do with the Eurozone crisis arriving back on centre stage. Soybeans have posted a $1 correction this week and look set to retrace further – although the market feels there could be more issues to come from the US weather problems.

> The rapeseed harvest is now under way in the UK. Early reports on yields are around 3.5 tonnes/ha, with mixed views on quality at this stage. Matif rapeseed prices have dropped €25/tonne on the back of soybeans retracement. We also have a natural carry between August & November rapeseed futures, something we haven’t seen for some time. Harvest ex farm prices are back trading around £364 and £374 for November depending on location, and farmers now appear happier to sell something with harvest underway.

> Global financial and commodity markets have been heavily influenced by the ongoing Eurozone crisis with Spain leading the way. Spanish 10 year bond yields have jumped to 7.55% this week which financial forecasters believe is unsustainable, and would suggest Spain requires a full-blown bailout. Greece, acknowledging that they are behind with the implementation of required austerity measures, is doing nothing to assist confidence. Growth has slowed down in China and in Europe. Even the powerful countries, such as Germany, are about to be downgraded due to their Eurozone liabilities to member countries.

GRAIN market information contact Jonathan Lane, Trading Manager, on 01427 421221 or

OILSEED market information contact Willie Wright, Oilseeds Trader, on 01427 421246 or


Leave a Reply

Your email address will not be published. Required fields are marked *

Advertise With Us

A great opportunity to promote your business to our dedicated readership of farmers, landowners, estate managers and associated agricultural professionals.
Contact us today on 02476 353537 and let’s work together to drive your business forward.