With some of the best August weather for several years, a significant proportion of the spring and winter wheat crops have been harvested within a relatively short (and early) period.
In the build-up to the harvest, many growers commented on how close together the wheats and spring barely were looking maturity-wise. This judgement has proven right with many crops reaching ripeness at the same time. Luckily, this has coincided with the great harvesting conditions we have experienced. Coupled with combine harvester capacity that most farms have available, and the 2021 harvest must rate and one of the quickest to this stage on record.
Winter and spring wheat
The yield and quality of the winter wheats this season have been average. While many first wheats have been yielding exceptionally well, with some reports of crops above 12t/ha, reports coming from farms are indicating that the second wheats haven’t performed as well, so bringing the average down, possibly to around 9t/ha for the main producers.
Specific weights have been quite variable, but comfortably within required specification and, as is usual with favourable harvesting conditions, hagbergs are also reasonably good. The noticeable difference in grain quality from recent harvests is protein levels. Protein is generally testing low (soft wheat regularly 8-9%), which hinders markets such as milling but is good news to distillers.
The yield and quality of the winter wheats this season have been average. This year’s Spring barley yield has been on the lower end of expectations, with many crops failing to do much better than 5-6t/ha. Compared to 2020, which saw yields hitting over 7t/ha across many growers in our region, is very disappointing.
However, it is pleasing to see the quality holding up. For malting barley growers, consistent low N, low screening and minimal skinning tests give reassurance of getting the loads tipped at intake. The lower-yielding crops have already led to a tightening of the availability of barley for markets beyond malting, which has been reflected in a rapidly increasing price being paid for feed barley.
Grain markets across the world have been well supported throughout August, with reports earlier in the month indicating concerns on wheat and corn yields in the US, Canada and Russia.
With world stock levels at relatively historical lows, the grain futures market is much more sensitive than usual to bearish reports. This is the case in August, with the yield figures prompting further gains in the UK wheat Nov 21 futures reaching £195 on two or three occasions in the last week or so. At the time of writing, it stands at just over £190 for Nov 21, with both buyers and sellers watching the information coming in to figure out what the next trend is likely to be.
With the wheat harvest in the northern hemisphere now being 80+% complete, the outcome is fairly well known for the short term with attention now shifting to what happens in the southern hemisphere, particularly South America and Australia.
There are expectations that Australia could have a very good harvest, but this may be countered by poorer growing conditions in many areas of Argentina and Brazil. Much could still happen to push this market in either direction.
Localised pressure on barley availability has forced the market higher and prices have risen from levels around £150 ex-farm at the end of July to almost £170 ex-farm last week. Prices over £170 have been getting offered in areas where local demand is even greater. The maltsters have still to show their hand as far as pricing the quality barley but, likely, they are now having to consider paying up to support those growers on contracts. If they offer a healthy premium overfeed, this could put even more pressure on feed/pearling values going forward.
An added complication that has surfaced this year and cannot be ignored is the lack of transport available to convey grain this harvest. Reports are coming in constantly of poor grain movement off farms as well as merchants falling short of delivery targets at end markets. The well-publicised lack of HGV drivers wasn’t expected to hit the agricultural industry too hard but this is proving not to be the case and, as I mentioned in the opening paragraph, the speed that this harvest has been claimed has exacerbated the situation in the short term. It will be interesting to see how this worrying development can be overcome.