By Olivia Cooper
AS the UKs wheat harvest approached the halfway point midweek, confusion still reigned over the likely tonnage that combines will cut.
Trade estimates range from 11 million tonnes to 13m tonnes.
David Balderson of co-op Viking Cereals favours the lower end of the scale. “I really dont think people have grasped how small this harvest is going to be.”
Total wheat area is 20% down on last year at 1.68m ha (4.15m acres). If yields suffer a similar drop to 6.5t/ha (2.6t/acre), total production will be 11m tonnes, the lowest since 1988.
But James Maw of Glencore Grain reckons yields are only down about 7-10% on last year, giving a crop figure of 12-12.5m tonnes.
“But it is not the crop size that is of most importance,” says Mr Maw. “Everybody has become so bullish that they have forgotten to think what imports can do to the market.”
European wheat prices have been forced down by the cheap Black Sea supplies and a lack of interest on exports.
London wheat futures fell by 1/t on Tuesday (21 August), placing UK wheat at about 79/t ex-farm for November.
Milling wheat prices remain well supported, amid concerns over domestic quality.
Prices have eased slightly to about 90 ex-farm for September, as German 14% milling wheat is being imported at similar levels.
Gerald Mason of the HGCA says there are a host of reasons as to why the prices fall – or rise.
“What really counts is to know what price you will need to keep in business for another year, and set about getting that price.”