Commodities Update (4th November)

As I write this (04/11) the pound has risen and fallen against the dollar over the last month, and currently has a net gain of approximately a cent against the dollar compared to this time last month, with a similar story against the euro, with again an overall net gain of one cent compared to this time last month.

Some of this gain, and subsequent fall, was probably on the back of an expected rise in interest rates due to the increasing rate of inflation, but which hasn’t happened yet.

Oil prices have continued to rise over the last month, as reflected in the continuing rises in prices at the pumps with it not uncommon to see diesel prices over £1.50/litre now, however after rising and hitting around the $85/barrel mark in the last couple of days it has fallen back to where it was a month ago at just over $80/barrel.

Gas prices hit record prices as I wrote this last month and have continued to ease back over the last month, until the beginning of this month when it began to firm again, on the back of data showing Russian gas had stopped flowing into Germany, and infrastructure problems across Europe.  As a comparison prices per therm of gas are approximately five times higher than they were this time last year!

The latest two GDT results have seen further increases of +2.2% and +4.3%, with cheddar showing a significant increase at the last auction of +14.1%.  SMP also continues to rise with +6.6%, with both products now at their highest levels for five years.

Some of this increase is from rising demand from Asia again, and the southern hemisphere countries reaching their tradition end of lactations, so less milk available, as we head towards their summer.

With these continuing increases it would suggest further pressure to lift milk farmgate prices further.

Milk Powder
Skimmed milk powder (SMP) products have continued to see rises on the back of rising SMP prices on the global market.  However, Whey based products are also starting to see rises on the back of higher vegetable & palm oil costs.

Cereals have risen approximately £20/t in the last month, but the hope is these prices will ease as indications are of big crops coming from Australia & Argentina.

Soya has eased very slightly in the last month and is definitely better value than any rape products currently which on spot are currently over £300/t on farm delivered!

Prices continue to firm! This is on the back of the expected large tender from India for urea and gas prices starting to firm again.

CF entered the market again yesterday but only for Nitram, for full loads only and only for November delivery.  Tonnage & timing is limited with prices set to be withdrawn at the end of this week, or sooner if the tonnage sells out before then.  However, its pricing is looking good in the current market, and just shy of £600/t with imported AN around the £650/t levels.

Urea levels are now just shy £800/t, but for protected urea only.

Over the last month P & K prices have continued to firm as well with DAP now over £600/t and MOP above £500/t. 

It definitely pays to shop around for prices if you are looking for fertiliser still as I’m seeing quite a variation at times between suppliers for the same grade of fertiliser.

If you’d like to discuss your milk powder, feed & fertiliser requirements, then please call FAR registered Dairy Nutritionist & CowSignals® Master Andrew Jones on 07717 44288 or email