UK exports remain steady in January: Grain market daily

• UK feed wheat futures (May-25) closed at £174.95/t yesterday, down £1.75/t from Monday’s close. New crop futures (Nov-25) closed at £191.20/t, down £0.65/t over the same period.
• Domestic wheat markets followed global wheat prices down yesterday as traders awaited the outcome of a call between the presidents of the US and Russia aimed at ending the war in Ukraine. An end to the conflict is considered bearish, as it could increase exports from both countries.
• Paris rapeseed futures (May-25) closed yesterday at €471.25/t, up €5.25/t from Monday’s close. The Nov-25 contract ended the session at €468.00/t, up €8.25/t over the same period. The gains were supported by increases in Winnipeg canola (May-25) and Chicago soybean oil (May-25), which were up 0.9% and 1.1%, respectively.

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UK grain exports continued at a very steady pace in January, while imports remained strong, according to latest data from HMRC.

Sluggish exports

In January, UK wheat exports reached 18.7 Kt, above the 9 Kt recorded at the same time last year, but well below the five-year January average of 52.1 Kt. So far this season (Jul-Jan), UK wheat exports have totalled 88.8 Kt, a 48% decrease compared to last year and 80% lower than the five-year average. Exports of barley in January were down 35% on the year at 59.9 Kt. This takes season to date (Jul-Jan) barley exports to 317.1 Kt, down 37% compared with 2023/24 and 61% lower than the five-year average.

Stronger sterling, a smaller wheat crop and somewhat lacklustre demand from the continent have all been contributing factors to the UK’s steady grain export pace this season.

Full season wheat exports for the UK are currently projected at 175 Kt in the UK cereal supply and demand estimates, 32% lower than in 2023/24. For barley, full season exports are currently estimated at 500 Kt, 280 Kt lower than in 2023/24. The pace of both wheat and barley exports is expected to pick up somewhat towards the end of the season, although it will likely continue to be steady.

Imports continue at pace

While exports remained slow in January, imports of wheat and maize continued to be firm. In January the UK imported 258.6 Kt of wheat, taking the July to January  total up to 1.963 Mt. A large proportion of the wheat imported in January is again assumed to be of high specification milling quality with over half of the monthly volume (134.8 Kt) coming in from Canada. UK Maize imports were 307.8 Kt in January, the highest monthly volume imported so far this season and up 1% compared to last year. Total imports from July to January are now 1.73 Mt, the highest since 2020/21 and 17% above the five-year average. The lower price of maize compared to domestic wheat earlier in the season has driven the rise in imports, but this is expected to slow later in the season.

Is the current import pace going to continue?

It is expected that for both wheat and maize, the pace of imports will slow during the latter part of the season. It has been reported that importers of high-quality milling wheat have been front loading stocks. Likewise, its expected that a large proportion of maize has been bought forward, when prices were alot more favourable earlier in the season.

While wheat exports are expected to pick up slightly and imports are expected to slow during the latter part of the season, will this be enough to prevent large carry out stocks into 2025/26? A season where domestic wheat production is expected to return to more ‘typical’ levels.  Keep an eye out for the next UK cereals supply and demand estimates update which is due to be released next Thursday (27 March) and will have all the updated estimates for supply and demand for 2024/25.

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