Monday Market Briefing - 5th September 2022

We ended last week slightly higher and at the upper end of the recent range, mainly due to some Sterling weakness against the Euro which always helps ex-farm values. Both currencies are losing out to the Dollar which investors rush towards in times of crisis. Russia’s latest excuse for extending the gas supply shutdown, a leaking valve, was instantly ridiculed by the maintenance engineers Siemens. Sterling’s next move probably hinges on the new PM’s early performance and the programme they set out. In such times one wonders who will be the happier between Sunak and Truss, the winner or the loser ?

Currencies aside, markets lack fresh news and direction. The reduced volatility is actually a good thing as it stimulates trading activity, buyers have more confidence to act and we are seeing some demand creeping in – certainly not a stampede as we are still worried about recession and reduced economic activity  - but nevertheless healthy markets to get involved in.

Not wishing to be a harbinger of doom, but we may yet find ourselves looking back on this freely trading post-harvest period with nostalgia. If the energy crisis worsens this winter industrial usage will be sacrificed to maintain domestic supply and some energy intensive industries, of which grain malting is definitely one, could be severely hampered. The UK has strong non-Russian gas supply and we won’t run out ourselves but unfortunately we don’t have the malting capacity to process our entire crop at home so we are reliant on the European market functioning normally to get the job done.

At least everything is on the table today !  Have a good week.