Banks predicts 1.6m-tonne wheat carry-over

By FWi staff

BANKS Agriculture forecasts that about 1.6 million tonnes of UK wheat will be carried over from this season to the next – but the Home-Grown Cereals Authority says unsold feed wheat is becoming harder to find.

Farmers are reported to be reluctant to sell quality wheat to feed homes, says the HGCA.

However, the HGCA warns that with an increasing proportion of the better quality wheat may have to go as feed because more Group 1 and 2 wheats have been planted, resulting in less availability in Group 4 varieties.

According to the recent MAFF survey, about a quarter of this seasons wheat crop and one-tenth of the barley crop was still on farm at the end of March.

Barley stocks are significantly lower on-farm due to a smaller crop and large intervention stores, while wheat stock is in line with recent seasons, said the report.

It is estimated that less than 5% of the potential new-crop wheat has been traded on forward contracts so far – much less than in previous years, according to the Banks Agriculture weekly market report.

The report blamed this lack of forward selling on current low prices. But it warned that, just because prices were low at the moment, it did not mean that they wouldnt go even lower.

However, Group 1 and 2 varieties sown will benefit UK growers, as domestic and export buyers should remain interested, providing premiums are competitive.

“Higher yields of better-quality wheat should balance any smaller premiums over feed and better qualities might also find a home in intervention,” said the report.

Wheat futures at LIFFE have eased slightly with July 1999 contracts trading at £78.75/t today (Tuesday), and November slipping to £75.50/t.

See more