HROC (agency) - Kubota
Farminguk
31 May 2016 | Online since 2003
Auto Trader Ltd


4 March 2014 07:24:42|

Threat of halt to Ukraine corn exports gets market nervous


EU grains closed sharply higher as tensions between Ukraine (and the West) and Russia scaled up a level or two over the weekend. This is the biggest crisis of the 21st Century for Europe, according to British Foreign Secretary William Hague. Russia's military has given Ukrainian forces in Crimea until dawn on Tuesday to surrender or face an assault.
Mar 14 London wheat closed GBP5.25/tonne firmer at GBP161.00/tonne, whilst new crop Nov 14 was GBP4.55/tonne higher at GBP152.05/tonne. Mar 14 Paris wheat closed EUR7.25/tonne higher at EUR208.50/tonne, Mar 14 Paris corn was up EUR3.50/tonne at EUR172.75/tonne, whilst May 14 Paris rapeseed was EUR5.25/tonne higher at EUR400.00/tonne.
Crude oil jumped to it's highest since September, and short-covering/spec buying meant that wheat followed suit, despite reports that grain exports out of Ukraine had so far largely continued relatively unhindered by recent developments.
Agritel said that Ukraine exported over 500 TMT of corn last week, along with 57 TMT of wheat, and that Russian ports on the Black Sea had loaded more than 200 TMT of wheat in the final week of February.
Nevertheless, the threat of a sudden halt to Ukraine's exports (of corn in particular) has got the market very nervous. They are scheduled to be the world's 3rd largest exporter of corn in 2013/14, along with being the 6th largest exporter of wheat. Agritel suggest that Ukraine still has around 5 MMT of corn and 3 MMT of wheat left to export this season.
The Ukraine hryvnia and Russian rouble fell to new lows against the US dollar and euro, which in theory makes exports out of the region even cheaper. It also makes imports very expensive though, and raises the question of whether growers in the region will be able to afford to pay for these products later in the year.
What will Europe and the West do, if anything, in retaliation to the Russian invasion of Ukraine? This isn't sending a few thousand troops into Afghanistan to fight the Taliban, after all. Will (most of) the world announce sanctions against the import of Russian grains? If they do, will China follow suit?
As ever, the market doesn't like uncertainty, and so up it goes. As stock markets around the world fall, it now seems like agri-commodities are suddenly back in vogue. That's changed in the blinking of an eye, and could just as easily switch back again of course. Is this a selling opportunity, or the start of a move back to old ground, many are asking?
In other news, the HGCA reported that England and Wales had planted more than 3.8 million hectares of winter wheat, barley, oats and OSR by Dec 1, a 14% increase on last year.
They said that 1.815 million ha of that was wheat, 19% more than the entire harvested area in 2013, before including ant late winter wheat and/pr spring planted crops.
The winter barley area was almost 370k ha, the highest since 2003, and the winter OSR area was just over 700k ha, up 3% from a total (winter and spring) area last year, they added.
“The higher wheat area increases the likelihood of the UK being able to return to being a net exporter of wheat in 2014/15. However, weather conditions during the rest of the growing season will be important in determining the quality and yields, and thus the UK’s export potential next marketing season,” they concluded.

Download





0 Comment


loginuserlogo
Name

Please enter your name


Email

Comment

Please enter your comment


Post Comment

Your comment submitted successfully.Please wait for admin approval.


Comments

No comments posted yet. Be the first to post a comment


Australia | 31 May 2016
Dairy loans might be hard to access, but will help farmers face some hard truths

Low-interest loans may be difficult to access, but will also help people face some difficult truths, a rural accountant says. There's bipartisan political support for concessional loans, which form...


USA | 31 May 2016
Farmers get creative, frugal to stay afloat in tough times

After several boom years while the rest of the economy struggled, farming is entering its third straight year on the bust side of the cycle. Prices for corn and soybeans are low while expenses like se...


Australia | 31 May 2016
Exciting futures in agriculture veiled by dated agriculture stereotypes

There are six figure salaries on offer, and the chance for a fulfilling career producing food and fibre, but persistent and dated stereotypes of agricultural careers mean they're not often the first c...


Australia | 31 May 2016
Cattle worth $8,000 shot dead in northern NSW

Police are appealing for public help after four cattle were shot dead on two separate properties at Cangai, west of Grafton in northern New South Wales. Police believe the two cows and two bullocks...


Ireland | 31 May 2016
Dairy farmers to earn less than industrial wage in 2016

Farmers can't be blamed for the dairy income slump the ICMSA has warned, as it emerged the average dairy farmer is likely to work for less than the average industrial wage this year. Agriculture Co...



Trending Now

Viewed
Discussed

Farms and Land for sale

PropertyLocation
PropertyAgent
PropertyMinimumPrice
PropertyMaximumPrice
PropertyCategory

Holiday Rentals search

AccommodationKeyword
AccommodationType
AccommodationCounty
AccommodationStarRating


Top stories you may have missed
closeicon
Username
Password