Markets Decline as Crop Prospects Continue to Improve

There has been little change to the grain markets over the last seven days with regard to both ex-farm values and local harvest progress.

Feed barley samples are arriving at the office rather sporadically as growers attempt to dodge the recent rains and begin their harvest. Early samples are encouraging with bushel weights anywhere between 67-72kg/hl. Spot movement (generally for export) would make somewhere between £130-135/T ex-farm.

Malting varieties are also of good quality, particularly the Maltsters favourite SY Venture. Premiums on winter malting varieties are struggling to make double figures at the minute due to poor demand; ex-farm values are somewhere around the £140/T ex-farm mark depending on farm location and crop variety.

As for winter wheat, growers have advised crops are anywhere between 2-5 weeks away yet (although some of our Holderness producers have different ideas on this). A much drier, warmer forecast for the weekend will benefit the majority of growers in our area.

Ex-farm values for feed wheat are currently somewhere between £152-155/T ex-farm for September/October collection; movement straight off the combine would offer a couple of pounds per tonne less, whilst November collection would make a couple of pounds per tonne more.

Harvesting across wider Europe, the Black Sea and North-West America is continuing to make good progress. France, Germany and Sweden are now well into this year’s winter wheat crops with the majority of the winter barley harvest now in the shed.

Russia, the Ukraine and Kazakhstan are now believed to be around 30% of their way through this season’s winter wheat crop with yields generally above average. Crop quality also appears to be good.

In light of the above then, it is hardly surprising that UK feed wheat values have retreated back towards the £150/T position – the Northern Hemisphere appears incredibly well set for a good harvest.

However, it is important to remember at this stage that £150/T is still a good value, particularly given the potential of the above.

Last year’s local wheat yield was somewhere around the 2.5T/acre mark, with ex-farm values ranging anywhere between £140-£200/T+. This would, on average, give an income-per-acre figure of anywhere between £350-£500/acre.

If this year’s local wheat yield comes in at least averagely, somewhere around the 3.5T/acre mark, £150/T would give an income-per-acre figure of £525/acre or more.

Obviously these are rough figures and I am rather generally speaking here – but ahead of getting this year’s wheat crop in the barn it is important to remember that in the context of a potentially above average year, £150/T is hardly anything disastrous.

Meanwhile, OSR values remain unchanged this week with September values somewhere between £280-285/T ex-farm. Poor export demand, plentiful South American soybean supplies and a 6M/T German OSR crop are all pressuring values.