Barley-wheat price gap narrows as export interest grows

Export interest has removed the price gap between barley and wheat in many areas.

Ex-farm feed barley prices midweek ranged from £110-119/t compared with feed wheat at £116-£122/t.

However in many counties, barley and wheat values were equal.

See also: Currency fluctuations offer support to falling grain markets

To some extent the UK was benefiting from France doing more barley export business with China this season, to which the UK was not an approved exporter, said Openfield’s head of desk Glenn Mason. 

Barley is benefiting from slightly higher brewing, malting and distilling use at home but the 2014 crop produced about 2m tonnes more than domestic requirements for potential export or carryover into next season.

The latest export statistics show UK barley exports between July and November 2014 at 559,000t, their second highest level since 2003-04.

Although this is lower than the previous season, some large cargoes have shipped since the end of November, with barley the preferred feed grain in Saudi Arabia and some Asian markets.

The figures to the end of November show 35% of UK barley exports going to non-EU destinations.

Relative currency values are playing a huge part in grain pricing, and although the pound continues to gain against the euro, both sterling and the euro are weaker against the US dollar, helping European grain compete on world markets.

More UK wheat exports are also going further afield than usual, with wheat from several other European origins replacing Black Sea grain and UK wheat in particular becoming increasingly competitive against US maize.

Further European national elections, including in Spain, were likely to keep currency markets volatile this year, said the HGCA.

Meanwhile the premium for full spec breadmaking wheat reached an average of £47.50/t this week, with breadmaking wheat at £162-168/t ex-farm.