Feed market outlook – Dec 2019

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Recent jumps in the price of soyabean-derived feeds highlighted ongoing price volatility and the value of forward contracts in helping manage risk.

In addition to market reactions to changes in global soyabean supply and demand, UK livestock farmers face added uncertainty from exchange rate volatility. Any period of Sterling strength is a potential opportunity to build cover for summer feed requirements.

UK wheat prices have firmed following planting delays and concerns over potential harvest volume next year, but New Year might also see prices ease if farmer selling increases. For all feeds, the scope for prices to rise is still far greater than the potential for additional savings.

Key facts & figures:

  • Argentine soyabean crusher Vicentin SAIC missed $350m payment to farmers

  • Brazilian soyabean crop over 80% planted and beneficial rains due

  • Brexit-induced exchange rate changes can add 10-20% to imported feed prices

  • AHDB1 estimate for UK barley crop puts it at 28% higher than this year

  • UK sugar beet feed likely tight this summer, soya hulls a good alternative

  • Value of SugaRich Dairy improved as wheat futures prices have firmed

1 Agriculture and Horticulture Development Board

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