With only four weeks to harvest, both the Winter and Spring barley crops are looking surprisingly well. There is no doubt that quality, yields and nitrogen levels were affected by the 8-week drought during April/May. We could see the winter barley crop produce some high nitrogen barley, but this will depend on were they have been grown and what the soil conditions are like. The unknown factor is the nitrogen levels. No one can be sure just how much of the fertiliser applied after the first rain will go into the ear; it will be very much wait-and-see.
The biggest problem with winter barley at the moment is secondary tillers. Because the crop had been so stressed during the dry period it came in to ear early and had not produced many tillers. The late rains have encouraged the plant to start growing again and we now have barley, which is ripening at the top but green lower down. This will create problems not only with combining but also with more small green grains however, without the rain the crop would have been a lot worse. The winter barley crop can be described as variable.
The Spring barley crop has recovered well in some areas. Over on the light land some farmers have been irrigating barley, which has saved them from disaster. Other areas of the U.K. look ok and some will be excellent but again we could see higher nitrogen’s and poor screenings.
We have seen the feed barley market continue to rise as much as £15 per tonne in the last month. This means that feed barley is now worth more than some of our contract malting barley. Making sure we get the quality, tonnage and supply at harvest will be very interesting. We suggested in the last crop report that the U.K. would be as much as 200,000 tonnes short of malting barley. We don’t think this has changed that much but questions over quality still remain which will effect the available tonnage.
World grain markets continue to be very bullish with the London futures hitting contract highs again yesterday. Rain in the U.S. continues to slow harvest and hit quality. The French harvest is still unknown but with harvest just starting, early, reports suggest a reasonable quality but low yields. Demark, Sweden and Finland have had good growing conditions and at the moment the crops are developing well.
After being at “Cereals,” the agricultural trade Show, this week farmers are still unsure about what crops to plant for 2008. With the wheat market continuing to rise farmer’s decisions on their choice of cropping is slow. Farmers feel they were caught out last year by contracting barley early and then seeing the market move up by £50 per tonne. They are not keen on committing any tonnage at the moment. It’s becoming a fight for land availability and malting barley will have to be competitive on price over wheat to increase its area. The Biofuel market is still ongoing and will play a big part in farmers cropping decisions going forward.
We have seen over the past few weeks a series of reports writing down global 2007 cereal production and putting end season stocks of grain at a 30 year low. This has added further bullish sentiment in what is already a firm market.
We are in for an interesting season in what is an extremely volatile market place. Supply chain management, whether it is customers or suppliers, is very important. We must make sure we are able to compete on farms to secure land area and the only way to encourage farmers to grow Malting Barley is by paying the right price.
25th June 2007