At the close of the year, egg and poultry producers have now experienced six months of relatively stable ration costs after two years of turbulence in the feed market.
The last month has brought small declines in the cost of both wheat and soya, which in turn has trimmed the cost of our Layers Ration by £5 a tonne, which takes it down to just £3 a tonne above where it stood in July (see chart).
During that time it has remained within a range of £21 from lowest to highest.
More significantly, the average cost during the second half of this year was £66 a tonne below the average for the same period last year, and has been running at a similar level to two years ago.
The second half of 2023 has been characterised by an absence of any clear trends bearing onto world markets for wheat and soya.
Soya has been more volatile than wheat, moving within a range of £30 since July. Wheat prices have stabilised between £176 and £186 since their precipitous decline in the first half.
However, various weather factors have so far come and gone without great impact, and traders have already factored in the expected scenarios such as the Black Sea situation, a large Brazilian soya crop, and Chinese import demand.
Longer term, forward indicators for wheat and soya prices are both weakly bearish.
The latest worries about dry conditions for the Brazilian soya crop are not expected to undermine the overall supply outlook.
Wheat prices moving forward are likely to be suppressed primarily by ample global maise supplies.
Any weather worries that emerge will probably be focused on the northern hemisphere crop in coming months.
Ukrainian grain exports (wheat plus maise) are reported down by 5 million tonnes this year overall due to raids and blockades, but overall, competitively-priced Black Sea shipments (mainly Russian) have been a primary factor in suppressing world prices through most of 2023.