THE first signs of an easing in feed raw material prices have emerged, bringing hope that the pressure of feed costs on poultry farmers may begin to relax.
Both wheat and soya have slipped back in the past month, with UK feed wheat dropping for the second month in a row.
The average UK ex-farm price has now dropped by £38/tonne since October to £239/t, its lowest value since February.
This brings our Basic Layers’ Ration down to £343/t, back to July’s level, and down £60/t on its peak in May.
For the first time in many months, forward indicators for both wheat and soya prices are set to be mildly bearish overall for the coming months, although with a mix of both upward and downward factors acting on the market.
For now, the overriding downward factor for wheat has been a steady flow of shipments out of Ukraine at highly competitive prices.
Predictions of a record wheat crop in Australia have reinforced this.
Meanwhile, a sizeable exportable surplus in the UK is finding few takers at current price levels.
In the longer term, there are emerging concerns for global grain prices over the next Argentinian crop, where maize plantings are running behind schedule due to dry conditions.
Although looking forwards, the soya market appears to be well covered for the time being, the balance could easily tip the other way.
Chinese demand remains unpredictable, and there are conflicting reports about the extent of drought damage to the crop in Argentina.
For now, the latest USDA forecast suggests slightly higher global production and exports, with season-end stocks rising by half a million tonnes to 102.7 mt.