Rural Commodity Markets trends: 8th March 2018

February has been a mixed month with some sectors remaining flat while others noted remarkable gains – and the extreme weather at the end of February likely to cause repercussion across all markets in the weeks to come. We take a look at some of the most significant developments below.

Cereals

February was a relatively slow month for grain trade with average feed wheat prices struggling to move out of the £135-£136/t bracket for most of the month.

However, the final week of February saw the average hit £138.3/t – the highest value since July. Merchants have put this down to the spread between old and new crop narrowing.

In barley markets, the balance between UK barley availability and demand this season was reduced by 277,000t to 2.206m tonnes, according to the latest AHDB estimate. This was due largely to animal feed demand which remained strong in January.

Oilseeds and pulses

Oilseed rape prices found strength again in February after falling in January and ended the month at an average price of £295/t - £7/t higher than the start of February.

Driving this was the influence of CBOT soybean values, as weather concerns in Argentina continued to lend support to both soybean and OSR values.

Beef

Finished cattle prices dipped during February, starting the month on 370.3p/kg and finishing at 365.7p/kg. According to industry reports, this suggests supply is in front of demand, however, there is also indication that processor demand may increase in the weeks to come. 

Sheep

UK lamb prices soared during February, starting the month at an average of 430.2p/kg and finishing on a high of 491.7p/kg – the highest value seen since June last year.

Prices also remained strong on the global market, therefore helping to support higher domestic farm prices, alongside reports of lower stocks of frozen lamb.

According to AHDB, should current market conditions continue over the next couple of weeks, it is expected that lower levels of sheep meat will be imported into the UK over the Easter period. 

Pigs

November pig prices in the UK remained relatively flat with little movement in APP values across the month. Despite little movement in values, production was noticeably higher in January, according to statistics from Defra. UK clean pig slaughterings totalled 928,900 head in January, 8% higher than year earlier levels.

Milk

UK farmgate milk prices continued to decline, with the January value falling once again, to average 30.60p/litre. Many processors have announced further cuts to March and April contract prices, with the UK’s largest dairy co-operative announcing cuts of 2.16p/litre on March milk values.

Despite the planned cuts, the Actual Milk Price Equivalent (AMPE) increased by 12% in February, which could be reflected in milk values in the months to come.

Potatoes: 

GB potato values remained relatively unchanged across the month, with values not moving much above £155/t. This is thought to be largely due to a high volume of supplies in the market. Lower temperatures at the end of the month have caused concern for some stored crops, as temperatures dropped significantly to lows of -9 degrees Celsius in some places.