Wednesday, 30 August 2017

August 2017 Update

The wet and stormy weather that dominated the last week of July has continued unabated into August. At the time of writing, most growers have only just managed two consecutive harvesting days! The relatively comfortable start to harvest in mid-july was quickly replaced with anxiety as heavy rain and wind in early-August battered very ripe Winter Barley and Oilseed Rape crops. Many growers by-passed winter barley in favour of OSR (being far more susceptible to storm damage) which unfortunately led to a loss of quality and yield in the winter barley crop.
Towards the middle of August most growers had made a start into spring barleys and wheats. Spring barleys once again have produced very respectable samples; if growers could consistently yield 3t/acre or higher with spring barley, it makes you question the merits of persisting with winter barley. Spring malting varieties all seem to be producing good quality and retention but with nitrogens marginally higher than has been seen in recent years.
Winter wheats so far have been fairly average; most first-wheats have been good but as yet nothing startling. Second-wheats however seem to have been much more mixed; it would seem that later drilled second-wheats that have hung on longer through summer have produced far better yields and quality than those drilled earlier. The greatest concern to have arisen through harvest is surrounding milling wheat quality; the persistent wet weather has led to a much greater variability in hagberg meaning there could be useful premiums over the coming year for any samples that do meet full-milling spec.
Grain markets have been a tale of two halves with OSR and feed barley remaining relatively unchanged for the last 4 weeks. Barley continues to trade at £118-120/t spot with no carry further forward; OSR is around £314 August and £325 for November, having seemingly never come under a great deal of harvest pressure, telling you everything you need to know about domestic stocks and farmer-sentiment.
Wheat markets have not been quite so mundane; having reached a high of £153/t for November in July, (at the time of writing) wheat has fallen to £138.50 for November. This is down to a couple of factors; firstly, it being harvest, markets (around the world) are always put under pressure. More importantly, a record-Russian wheat crop has been estimated at over 77 million tonnes, and coupled to improving US crop hopes the market has come under renewed pressure.  Domestically, it is difficult to the see the market sustaining these levels once we reach autumn. By this point most growers have moved everything they need to for storage and cash-flow purposes and are content to watch the market for a little while. With the incredibly strong demand for feed wheat in the North of England, the sellers are in a much stronger position.
The GrainCo seed-plant has now moved onto wheat processing and already a few varieties are becoming scarce; Barrel, Skyfall, Relay and Gator have all sold out, however there are good alternatives to be found in Siskin, Lili, Dickens and the old stalwart, J B Diego. As predicted Cassia feed barley has proved very popular again with only Tower and Glacier still available.
There is very little to report on in the fertiliser market at present with all attention on harvest and the up-coming drilling campaign. UK AN is around £200-205/t for Autumn delivery, imported AN continues to struggle and the incredibly poor exchange rate of the pound to the euro is not helping this situation. As expected, Urea has lifted to £225-230/t for autumn delivery and compounds remain fairly flat. There are decent offers for DAP at £330/t, which should be of interest to anyone looking to apply DAP when establishing OSR.
Call 0191 4287700 for all Grain Marketing, Seed and Fertiliser enquires.