Arable farmers who can cut feed wheat and move it straight off the combine can benefit from premiums of up to £20/t as buyers get increasingly deperate for spot supplies.
But fears over quality of the UK wheat crop have contributed to further drops in as-available prices, which have fallen to about £100-£108/t ex-farm. “The as-available price is low and nobody’s selling. I think people will hold on as much as they can,” said Jeff Russell of Western Arable Services.
Farmers fortunate enough to get on with combining could secure about a £20/t premium for immediate movement. “We have been paying £125-£130/t for movement this week and early next week,” said Mr Russell. However, many who could get on were cutting milling wheat first, and facing high drying costs as well.
Good quality milling wheat was critical to this season’s prices, said Simon Ingle from Grainfarmers. With a large exportable surplus, it was important that the UK could compete in the milling export markets rather than selling feed wheat in competition with cheap producers like Ukraine.
“The weakness in our market is very much because of the liquidation of wheat from the Ukraine,” he said. Black Sea exporters were selling feed wheat at about £100/t ex-port, so if the UK harvested a large, poor quality crop there was a significant downside to prices.
However, milling wheat quality was still holding up well, with Hagbergs good at about 300, heavy bushelweights, and low, but usable, protein contents. “We only need low proteins for exports of milling wheat,” said Mr Ingle. Anything over 11% protein would qualify as milling wheat and command a premium on the export market.