UK wheat exports will soar 42% this season to a seven-year high, helped by a late-season pick up in shipments, limiting the boost to stocks from two successive bumper harvests, official data showed.
Defra, the UK farm ministry, in its first forecast for domestic wheat shipments in 2015-16, which ends next month, pegged them at 2.75m tonnes.
Shipments at that level would be the highest since 2008-09, and would limit to 2.50m tonnes UK wheat stocks at the close of the season – a rise of only 74,000 tonnes year on year, and a forecast well below those being voiced earlier in the season.
Then, many commentators feared that a slow start to the season for exports, after the country had recorded two successive 16m-tonne harvest for the first time, would lead to a supply glut.
Indeed, London futures in early March fell to £99.15 a tonne, the lowest price for a spot contract since June 2010.
‘Steady pace of exports’
However, that was before confirmation came in of a surge in shipments since January, with the rise encouraged by the dent to sterling, until lately, from concerns that the UK might vote to leave the European Union.
While EU wheat shipments overall are staging a strong close to the season – helped by the swindling in exportable supplies in Russia, where merchants are being forced to pay up to find grain meet commitments – UK volumes have been particularly strong.
The 994,000 tonnes shipped in the January-to-March period was up 55% year on year, and the highest for the period in 13 years.
Indeed, the HGCA crop bureau said that 2.75m-tonne estimate “may be conservative, with the current pace of exports”.
While sterling has recovered somewhat, eroding the competitiveness of shipments, “exports are keeping a steady pace”, traders at a major European grain trader said.
London wheat futures have staged some recovery to close on Wednesday at £106.30 a tonne, with news of the reopening of Ensus – the northern England bioethanol plant with capacity to use more than 1m tonnes of wheat – also supporting values.
(Source – http://www.agrimoney.com/news/uk-wheat-exports-to-hit-seven-year-high–9589.html)