Wynnstay Humphrey Feeds & Pullets

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Weekly Commodity Report w/e 18th November

Currencies

This week we have seen the much anticipated autumn statement which appears will have an impact on everyone, whichever ‘tier’ you sit in. In terms of a strategy though, the market appears to have reacted well to the plan and the subsequent long term forecast on what that will do in terms of inflation figures with the £ strengthening against both the $ and €.


Wheat

There has been very little ‘fresh news’ this week which has meant the wheat market has felt very much on a downward trajectory. Prices are very much being driven by geo politics rather than crop fundamentals now and therefore heavily swayed by fund money.

The grain corridor has been agreed for a further 120 days, currently with no change although Russia are keen to push two key points during the next round of negotiations, an increase in their ability to export fertiliser and reinstatement to the SWIFT banking system for one national bank to make trade flow easier. The market did not react to this as much as may have been expected, perhaps because it was expected? Either way, technically May futures tested the key support level of £264 and then sharply rebounded (most likely spec money buying back in).

Physical demand in the UK is low now with more end users looking to defer volume into the new year because of downturns in demand for animal feed so this would suggest that over all, the market will continue to look weaker so long as nothing happens politically!


Soya

Soya markets, like wheat are on a downward trend now with spot UK vessel issues now resolved, (although water levels in the Mississippi are still a concern and could cause issues later in the season).

The size of the expected South American crop on the cusp of a recession cannot be ignored with Brazil upping their estimates now from 151.5 MlnT up to 154.5 MlnT. The only watch point is China’s easing of their Covid policy which could give some additional demand to the market.

We are now starting to see offers for suns again following the agreed corridor extension after their period of withdrawal.


Organic

We continue to see organic prices moving lower as demand for organic materials in general begins to fall now and UK shippers are sat with full stores. Currency will also impact price to a point but it feels as though this is beginning to become a demand led pricing structure for the time being.


And Finally…

A Happy Sun

Recently, NASA’s Solar Dynamics Observatory caught the Sun "smiling." A picture was taken, which when seen in ultraviolet light, shows dark patches on the sun, which are known as coronal holes.

Coronal holes, are temporary regions of relative cool (on the sun’s surface!), which has less dense plasma in the solar corona. The scientists amongst you will know that it is here that the Sun's magnetic field extends (in the form of a fast solar wind) which flows from here out into space.”

Nasa’s Solar Dynamics Observatory investigates how solar activity is created, and it affects space weather, and was first launched on 11 February 2010

NASA kindly shared the photo:

Not everyone that saw this report on Twitter took the observations seriously………

Regards,

Kay Johnson & Martin Humphrey