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Weekly Commodity Report 9th November 2018

The UK grain trade is waiting for news: from the USDA for the latest world supply and demand estimates, production estimates from Conab in Brazil, and of course solid news on the big Brexit deal.


News continues to change daily on how close we are to a deal and what the effects will be on trade, legislation and life after the EU.  These changes had most effect on currency markets and in turn this affects export competiveness especially important with the small crop size across Europe.  With the pound firm against the euro as there seems to be generally positive feelings around Brexit, despite questions over the Irish boarders remaining. 

November wheat traded lower this week, ending the week at £167/T, a level not seen since July.  Farmer selling remains low with prices feeling low compared to what has been seen recently and whispers of a difficult winter giving the arable farmers hope of better prices against winter feed despite the recent adjustment to the UK supply and demand due to plant closures.


The European wheat market firmed despite the low pace export to non EU countries, down 26% on last year.  Global reports including the USDA indicated that the revision of Chinese crop figures including acreage, production and stock added 150 Mln T of maize and 6 Mln T of wheat to the global availability.  On the other side of the equation, global estimates remain little changed due to production and exports reductions from other countries such as Australian and Ukraine.  Some reports suggest that the Russian Ag Ministry had lowered their estimate of total grain exports to 35 Mln T - closer to the previous wheat only figure and down from 38-39 Mln T.  These reports were subsequently denied – typical Russian confusion!  Whichever account is true, the current measures are slowing the Russian export pace to around 1.8 Mln T a month, which brings hope to other markets such as the US and EU that demand will turn to them to improve disappointing export figures achieved so far this year.  The US market remains range bound with further reports due and news of the mid-term elections being digested against these new figures by the trade.

Prices remain relatively low for both soya bean and meal but gained back much of what was lost following the USDA report with the release of the WASDE report.  Reaction to the US elections was more muted than expected.  The USDA lowered its soya bean production estimates but were balanced by higher closing stocks.  This was driven by the increasingly low export estimates primarily due to the loss of Chinese business arising from the trade disputes that have been key to this season.  Despite US soya bean exports remaining 2% above the four week average the figures were still far below trade estimates.  The trade still feel the USDA export figure is too high but news that Chinese consultant JCI indicated that soya imports to China would raise by 3.7 Mln T was considered an indication that relations with the US may be improving at last. 


It is generally considered that scientists are smart and pick to study subjects to make a better.  Well they have clearly done just that with the new paper titled “The Physics of Baking Good Pizza”. 

In this paper they took on the task of studying the great pizzaiolos of Italy to produce an equation to allow you to make your own perfect pizza at home.  The secret seems to incorporate the thermodynamic principles of the traditional brick oven. 

The simple Margherita pizza under ideal conditions takes exactly 2 minutes in a brick oven at 330 degrees Celsius.  If additional toppings are added then the pizzaiolo must lift the pizza off the brick for an additional 30 seconds to prevent a toasty bottom!

But if you do not have a traditional brick pizza oven, you will need to make a few adjustments due to the metal of your oven having increased heat conductivity compared to brick.  The equation takes into account the water content of the ingredients and the thickness of the base to name a few things.  So what the equation so you can give it a try…….


So we admit we are none the wiser either, but do let us know if you manage to make the perfect pizza.        

Source of information: Live Science