The world wheat market looks well supplied with less buying interest than had been expected and slower Russian exports failing to translate into increased demand for other origins. In the UK, Brexit uncertainty is stifling trade as everyone involved waits to see how the political situation will play out, one trader told Agritrade News.

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David Woodland, senior trader at Gleadell Agriculture, explained that much of the current sentiment in the market is linked to trade talks between China and the US which are seen as underpinning the maize market. “Certainly wheat seems to be a commodity at the moment which is searching for demand,” he said. “There is plenty of wheat around, but not a great deal of international buying activity at the moment.”

One reason for that is that harvesting will start in some of the key importing regions in the next few months. “Tenders are going to be very few and far between, and will probably be aggressively offered,” he said.

“Russian exports are slowing which everybody expected,” Mr Woodland continued. “However you haven’t really seen the influx of trade come back into the European or American trading books yet, so those markets look like they could well end the year with stocks higher than currently projected.”

The UK market was “all about Brexit,” and “what happens next week with the vote on the PM’s proposal.” He suggested that most people, including the City financiers, believed the chances of the UK asking the EU for an extension of Article 50 were growing. But this would have to be agreed by all 27 EU member states.

“If that does happen then theoretically we can then carry on imports and exports at the current zero tariff, which means it is likely that more imports will come in to the UK,” he noted. “We won’t export very much because we are not competitive and the UK surplus will increase.”

The effect of this will be to pressure UK farm prices down, Mr Woodland forecast. “On the flipside, if we don’t agree anything next week and we drop out of the EU at the end of March, potentially that means that paying that tariff,” he reckoned. “The price will come off the farmgate level. Whichever way you look at it, in the short term, it is probably negative to farm prices.”

“In the UK the whole market seems to have ground to a halt,” he said. “Any buying interest is just day-to-day.

“There is not a great deal of what being offered,” he explained “What is being offered is from sellers who have got margin aspirations in mind and they are unwilling to break those at the moment. If the market goes up, they take their aspirations with them, or if it comes down they still want the same premium but the buyer will have to drop his price a few quid.”

“There is very little spot trading going on at the moment,” Mr Woodland concluded. “Longer term? Not a lot of people are looking at that.”