Rations costs took a tumble in the past month, with a substantial drop in UK prices for both soya and feed wheat.
By the first week of April, UK feed wheat stood significantly lower than just before the start of the conflict in Ukraine, at £201/t compared with £218/t in early February last year.
In fact, wheat is currently at its lowest level since October 2021.
In the case of soya, although other factors beyond the war support a bullish sentiment, prices have fallen back to last autumn.
At the start of this month, soya was down £60/t from its peak just a month earlier, to £517/t.
As a result, our estimate of our Basic Layers’ Ration is down £31/t during the past month to £314/t; and down by £78/t on the same month a year ago, which is when ration prices were close to their peak.
For now, our average ration remains a little higher than at the start of the conflict.
In the wheat market, prices have been undermined by plentiful Black Sea shipments from both Ukraine and Russia at keen prices.
Ukrainian supplies, in particular, have been putting a brake on European prices, helped by the EU’s announcement that it will allow tariff-free wheat imports until June next year.
In the case of soya, the existing market fundamentals have remained in force, but the South American harvest is now all but complete.
The emphasis has been shifting away from the weather damage in the Argentinian crop, and towards the massive Brazilian one.
Estimates for the latter are still being revised upwards. Market sentiment is now turning its attention to the next US crop, where better weather conditions have favoured progress towards preparation for planting.
There is still no confirmation of the renewal of the Black Sea corridor from May, the outcome of which could send the trade in either direction.
Large flows of grain out of the Black Sea are pressuring international prices.
The completion of the South American harvests has eased fears of shortages.