Monday Market Briefing - 8th August 2022

Dare we talk about grain markets starting to look a bit dull ?  Not really at this time of year, but it’s a fact wheat futures are now sideways to unchanged for several weeks, daily volatility aside. There are plenty of supply side issues that could eventually drive our markets higher – most of which we have covered in recent briefings – but the gloomy economic outlook overshadows everything right now. Gas prices are rising again as an increasingly desperate Russia chokes off European supply lines. However, internationally traded crude oil is 25% cheaper now than its early June peak and that is the better measure of worldwide economic activity and confidence. Almost regardless of what this Fridays USDA update holds, it will be difficult for grain prices to push upwards against such a backdrop.

The next ten days will see harvest completed in southern England and grain quality across the region is excellent. Milling wheat premiums look robust, and we expect demand to be healthy for the intermediate proteins as well as the top grades. Malting barley premiums were very high and are now under some pressure in the face of high pass rates and a large Scandinavian crop emerging. But all is not lost, there will be a healthy export market for our own very good crop, UK spring barley is highly regarded in European markets these days, and we should be able to deliver cargoes in nitrogen specs that buyers like.

Have a good week.