THERE’S SOME better news on the grain trading front, as wheat has recovered by £15 per tonne for old crop since recent contract lows and there is some new support with exports taking place, plus the recently opened biofuel plant on Teesside will help reduce the UK surplus of 2.161m tonnes.

Buyers also expect to use 450,000 tonnes more over the next six months, so the surplus is expected to come down quite quickly.

Another factor is that the Black Sea exports which have put a dempener on the mraket in past years, are not happening this time around. A weaker sterling is also making the UK more competitive against the US dollar.

However, the US wheat markets remains firm as the US maize crop is only 37% harvested, compared to thefive-year average of 82% and is giving cause for concern with the harvest the latest for 30 years.

The US winter wheat area planted for 2010 will be the lowest for 38 years so, again, prices are holding firm as fund managers put money into agricultural futures as a result of strong stock and oil markets.

World wheat production is forecast up again, however, to 672m tonnes, which is 3.7m tonnes higher than previous forecasts due to increased tonnage from the Former Soviet Union, but also there has been a decrease in tonnage in the EU27 Countries and Canada. Global wheat stocks are now put at 188m tonnes up from 164m tonnes in 2008/09.

US stocks alone are forecast at a 10-year high and Australia is expected to export 18m tonnes in 2009/10, compared to 14m tonnes in 2008 and 7m tonnes in 2007.

The UK wheat area is forecast up by 12% for 2010 harvest and barley is down 15% and the EU27 Countries expect 1% increase in wheat planting and a 6% drop in barley.

EU soft wheat export licences now total for the year to date to 6.6m tonnes, compared to 9.0m tonnes last year with all cereal exports at 8.1m tonnes, compared to 13.5m tonnes in 2008.

November, 2009, wheat futures remain unchanged at £104 and November, 2010, futures are down 50p to £114.50, while November, 2011, are up £2 to £122. Spot feed wheat ex-farm Scotland is currently worth £103.50 and the UK average is £98.20, up 50p.

Feed barley ex farm Scotland is worth £80 per tonne and £89.30 for malting samples. Winter barley malting samples are worth the same as feed at present and the UK average for spring barley malting samples is £88.90, which is £2.30 up on the week.

Some 7400 tonnes of barley have been offered into UK intervention stores up to November 12, with approximately two-thirds of that total coming from Scotland. More is heading into Intervention from Scotland as discounts to wheat in Scotland are between £25 and £30, compared to £15 in the south and £20 in the North of England.

Even though there are some exports and intervention movement, the barley carryover is expected to be similar to last year. But, as the barley planted area in the UK is well down on last year, then discounts between wheat and barley will reduce and those that continue to grow malting barley could still command reasonable prices from contracts that are offered by maltsters.

Oilseed rape delivered ex-farm Scotland is currently worth £232 per tonne, down 50p on the week and is in part due to the world oilseed stocks being topped up by record harvests across the globe. The US soya harvest is now 80% complete up from 50% last week and is expected to be tidied up in the next 10 days.

Global oilseed production is put at 97.8m tonnes and world rapeseed production estimated at 58m tonnes. However, the MATIF rapeseed futures were up £3.75 on the week to £246 for February, 2010, and up £4.50 to £252.75 for November, 2010.

The GB weekly potato average rose £5.95 on the week to £99.36 and compares to £108.75 in 2008. The ‘free buy’ price dropped £1.74 to £76.50, which is £23.26 per tonne down on 2008.

Provisional estimate for this year’s UK potato harvest is 6.153m tonnes, which is 3.5% up on last year and is due to increased yield estimates of 47.2 tonnes per ha, which is 3.3% better than 2008.

The 2009 tattie harvest is now 98.6% complete at 128,500 ha, but any remaining acreage could well be difficult to lift as more rain falls and the threat of frost increases.