Yield predictions revised up
By Philip Clarke
HARVEST estimates published last week are already being revised upwards, as more yield data becomes available and June census results from MAFF point to a bigger than expected area increase.
Allied Grain had predicted a record wheat crop of 15.04m tonnes, based on 3.73% extra plantings and a 1.3% yield improvement to 7.8t/ha (3.2t/ha).
But provisional June census data suggest the wheat area harvested actually increased 5.6%. And better-than-expected crops in the north of the country have raised yield predictions to 8.02t/ha (3.25t/acre). As such, Allied is now suggesting a wheat crop of 15.74m tonnes.
"This further increases the surplus disposal problems, though the UK has got off to a good start with lower prices allowing us to take a larger than expected share of the EU market early in the season," says Allied. "Exports of wheat for August and September are on target to pass 750,000t, but will need to continue at or above these levels for the next nine months to soak up this record crop."
Similarly, Dalgety, which last week suggested a much bigger wheat crop of 15.9m tonnes – based on a 3.8% area increase and 6.7% yield gain – is also raising its estimates.
But even taking last weeks forecasts, the trade will have quite a job finding markets for all the wheat, warns Dalgety. It puts the export surplus at about 4.65m tonnes, 1.5m tonnes more than last season. There is also a certain amount of last years harvest still on farm, adding to this surplus.
"The marketing of this years crop will present some major challenges as the trend towards higher yields is reflected across the EU, requiring new third country export destinations to be developed," says arable crop marketing manager, Andrew Barnard.
Quality is variable, according to commercial manager, Trevor Harriman, but does not in itself present a major problem. "We see a different pattern of off-take to last year, firstly because southern Europe had excellent growing and harvesting weather, thereby reducing the need for our assistance.
"Conversely, we have seen good demand from north Europe over harvest as other areas were late and the early EU food aid cargoes have been executed from the UK. Grain was going out of Germany and Den-mark into eastern Europe, drawing our grain into these markets."
But he is still cautious about price prospects. Latest estimates from Paris-based analysts, Strategie Grain, put the EU harvest at 199m tonnes, 23m tonnes more than last year. France has an especially big crop, while latest projections from the US Depart-ment of Agriculture point to falling world demand.
But on the plus side Brussels has brought to an end its policy of taxing exports, in response to pressure from shippers. "By changing the regulations, Brussels is giving a clear signal that it is about to participate in the world market," says Mr Harriman. *