UK - UK May-15 wheat futures closed firmly below the £130/t support level yesterday (28 January), settling at £127.05/t, trading lower again as of yesterday morning.
With the strong US dollar compared to the sterling, this has helped UK wheat to fall to its smallest premium over US May-15 maize futures since September 2013 at $39.63/t, increasing the competiveness of UK feed wheat on the world market.
US maize is a benchmark global feed grain, which UK feed wheat exports onto the world market must compete against. With the weakness of the euro against the sterling, UK wheat exports outside of the Eurozone are especially important for avoiding excess stock build up in the UK market.
Trade data available so far shows that non-EU destinations have already accounted for a much larger proportion of UK wheat exports than by this point in 2011/12 – the last season the UK was a net wheat exporter.
The continuing currency trends and abundance of grain in the EU suggest that this could increase further.
TheCropSite News Desk