Turning away from the much debated US harvest for a moment we note the level of concern being expressed at the prospects for next year’s UK grain crops even though this year’s is not fully harvested. Wet weather which has delayed this year’s crop has hampered both drilling and crop establishment as rain continues to fall on already saturated fields.
The prospect of acres lying unplanted, or fallow, is looking very real and this will impact output next year, hot on the heels of this year’s much discussed weather hampered season in which both yield and quality have been compromised. Unless conditions change, and change rapidly for drier weather, we will be facing another potentially poor season.
UK wheat import volumes this season are likely to exceed those of the 2007/8 season when a total of 1.44 million mt was imported to bolster the poor harvest. In that year though the quality of the harvest was significantly better than that harvested this year and demand levels then were probably half a million tonnes less than they are today. Early signs confirm the situation with July showing net imports in excess of 100,000 mt, albeit much was imported to shore up demand which could not be satisfied by the weather delayed new crop. Additionally, flour millers will likely require imported grain to meet their quality demands which seem unlikely to be met by domestic supplies this season.
In today’s wheat tender by Egypt it was noticeable that Russia put forward no offers, indeed nothing was offered from the Black Sea region as a whole. Argentina secured 60,000 mt of business as France picked up the remaining 180,000 mt and despite reduced FOB offers for US origin wheat the freight disadvantage when compared with France left the US out in the cold.
US broker FC Stone has estimated the US soybean crop at 2.489 million bu, an improvement of 215 million bu and a yield of 38.2 bu/acre which is 2.9 bu/acre above the last USDA estimate. Corn also received an upgrade to 10.824 billion bu with a yield of 123.9 bu/acre which is a modest increase on the current USDA figures issued in September.