UK grain quality takes a dive

WHEN THEY can, combines are out in force cutting winter barley in the Borders and, further south, oilseed rape is being harvested as well.

By the end of last week, the UK winter barley was estimated to be 35% cut and oilseed rape ,15% cut. So far winter barley yields have ranged from 5-8t/ha with typical farm yields of 6-6.6t/ha, compared to 7.0-7.2 t/ha reported at this time last year.

Early indications are that specific weights are low, in a range of 48-63 kg/hl. This has led to worries about marketability of these crops, with an average reading for the week of 57kg/hl.

Screenings are also running at an average of 7%, which is up from 3% a year ago. To date, only around 35% of the feed barley varieties sampled have made the minimum 63% requirement and another 35% are between 60 and 63 kg/hl.

Harvest is approximately 40% complete in France for spring barley and, although results are slightly better than their winter barley, there is still a high level of screenings and low yields. This has resulted in in an increase in EU values and premiums are quite attractive.

UK feed wheat futures for November recorded a marginal decrease of 35p last week to stand at £125.70 and for November, 2017, were down 85p to £133.10. Oilseed rape was up £6 on the week and delivered to Erith for the crusher was worth £304.50.

UK ex-farm bread milling wheat was down £2 to £135.40 and feed wheat was up £1.50 to £111.50. Feed barley ex-farm was up 80p to £97.

With UK oilseed rape approximately 15% complete, yields are ranging from 2.9-3.4 t/ha. Compared to the five-year average of 3.6t/ha, yields so far appear to be slightly lower – typically 5-20% below average – and the estimate for the UK harvest is now at 2.1m tonnes.

The European rapeseed crop estimate has also been reduced from 21.5m to 20.7m tonnes due to lower yields in France and Germany – that would be 1.2m tonnes lower than last season.

France is expected to produce 4.8m tonnes, Germany 4.9m tonnes and Poland 2.3m tonnes. Bulgaria, The Czech Republic and Denmark are expecting better than forecast yields, however, with record crops in Australia and Canada, which probably means an increase in imports into Europe is expected from these regions.

The UK wheat harvest has just started in the south of England with kg weights between 74-80 kg, variable proteins and moisture around 14-15%.

Currency continues to underpin UK wheat prices, with the pound weakening in expectation that the Bank of England will lower interest rates next week.

France has again lowered its estimate for wheat to 28.2m tonnes, a four-year low and the lowest figure in 28 years – well below the 40m-plus tonnes achieved in 2015. The harvest there is expected to be the worst since 1976 due to the wet weather in May and June causing many problems.

It is the EU’s top wheat exporting country, but sits in a cloud of uncertainty alongside Germany and the UK in terms of crop quality and yield. Western Europe appears sandwiched between ample wheat supplies in either direction, with record crops in Russia to the East and bumper US yields in the west.

Russian wheat production is set to reach a record 65m tonnes, a rise of nearly 4m tonnes year-on-year. Despite that bumper wheat crop, Russian wheat may be less competitive in world markets after a period of depreciation and issues with setbacks from the export levy.

Even France bought 55,000 tonnes of wheat last week which represents an unusual trade flow and shows the desire of French buyers to prop up their new crop supplies in the face of a domestic crop compromised by rain.

World grains production will come in just 1m tonnes from its record high as the International Grains Council increased production by 20m tonnes to 2.046bn tonnes for coarse grains and wheat in 2016/17, taking the figure within an ace of the record high set two seasons ago.

This upgrade reflects in part an increase of 6m tonnes, to 735m tonnes of world wheat output, as improved estimates for the former Soviet Union and US have offset a downgrade to expectations for the EU harvest, especially France.

The bulk of the grains upgrade was down to an increase of 14m tonnes to 1.017bn tonnes in the forecast for world maize output, taking it within 1m tonnes of the 2014/15 record high.

Estimates for grain demand have been raised, too, with global grains consumption surpassing 2bn tonnes for only the second time.

However, the estimate for world grain stocks at the close of 2016/17 was raised by 6m tonnes to 488m tonnes due to maize facing strong competition from wheat in the feed market and as a result of a below average quality wheat harvest.

Global maize stocks will, rather than falling 2m tonnes over the season as previously estimated, will rise by 6m tonnes to 213m tonnes.