Frontrunner - 20th November 2020

World wheat markets stalled this week with a lack of any fresh bullish features to drive them higher again. US Chicago Board of Trade (CBOT) wheat futures drifted as their winter wheat crop rating made modest improvements following recent rains. 46% of the crop is rated ‘good’ to ‘excellent’ and is up one point on the week. This is still well behind this time last year when 52% of the crop received this rating.

96% of the planned area is planted. Export sales were lower than expected at 192,000 tonnes. Market expectations were for 250,000-500,000 tonnes. This created a lacklustre tone for the market. However, the tight UK wheat supply situation bucked the trend, with London wheat futures setting new contract highs, driven higher by a spell of animal feed compounders taking cover for their forward positions. UK millers, however, remain mostly absent from the market and the prices they offer are heavily discounted to imported supplies. It seems likely this will continue to be the case until the Brexit outcome is established. Meanwhile, ships carrying imported supplies continue to berth at ports around the country.

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