March’s disappointing weather abated somewhat in April, which allowed for the sowing of spring cereals. However, this wasn’t the case across all areas of Scotland. The Northeast of the country has found spring challenging, with some parts of Aberdeenshire still having quite a large acreage of spring barley to be sown. With it being the accepted rule, that later sown crops produce a smaller yield, this means farmers in that area will have the double effect of higher input costs and lower-yielding crops, which is not a good combination.
Crop conditions
With cooler conditions continuing into April, winter cereals have progressed at a slow pace than in the last couple of seasons.
Oilseed rape has continued to thrive in cooler conditions and has developed into full flower across most crops. There is a concern that cooler and wetter conditions are not helping the insect activity that is needed for the rapeseed to be pollinated.
While winter cereals are slightly behind where we would ideally see them, the crops were well-established through the winter, so plant numbers are still sufficient to hold good potential, even though many haven’t tillered as well as they might if the conditions had been better.
Recent wet conditions have also increased concerns about disease. Septoria in wheat and rhynchosporium in barley can both be spread up the plants onto new leaves due to rain splash, so farmers need to take extra care to protect crops with fungicides.
The spring barley that has been sown is emerging and progressing well. While air temperatures may have been low, the soil has been warm enough to allow good establishment and there has been plenty of moisture.
Markets
Following the weakening grain values seen in March, the last month has seen this trend continue for both wheat and barley. Low export activity and poor domestic demand putting pressure are putting pressure on old-crop cereals.
Wheat prices have stabilised slightly with prices continuing just below £200 ex-farm for May/June positions, but there are little expectations for this to improve for the remainder of the season unless something unexpected occurs.
One of the biggest changes has been the loss of the price differential into the new crop positions. At the start of April there was a premium between old and new crop of around £14-£15, but this has diminished to £7-£8. This takes away the support that was giving farmers on their old crop balances. Scottish farmers are also aware that, despite prices being weak, they are still much better than those being offered on the market in the south of England.
The most challenging market continues to be feed barley. There had been an indication of export interest, which gave the market hope of support and helped to maintain the ex-farm price at £170-£175. Recently, this demand has been quelled following the aggressive selling of barley from German exporters which has made prices soften back to £160 ex-farm.
There is such little UK demand that much of the barley that is still being held on the farm may struggle to find a home before the harvest. As with wheat, the new crop values of feed barley have diminished considerably, which has removed the benefit of the carry from old crop into new. Harvest prices are now looking closer to £165 ex-farm.
Even the malting markets are showing similar gloomy sentiment and harvest values are now looking likely to be around £220 having been £240 in earlier April.