By Robert Harris
AN EXPECTED bumper UK harvest and the strength of Sterling are likely to compound already low returns for wheat growers, it was claimed this week.
World prices are unlikely to rise above £85/ t in the future, according to Gary Hutchings of Dalgety Agriculture. And growers expecting a weaker Pound to push prices up will be disappointed, he adds.
“If currency had been the only factor affecting cereal prices in the past 12 months, then wheat should be worth about £95/ t. Its actually worth £20 less than that.”
Poor quality last harvest has already cut prices by £4-5/ t. Lower values for French wheat – which have fallen by £13-14/ t this season – are likely to drive UK prices lower.
Any future recovery in UK wheat prices is likely to be small. A potential16.6 million tonne UK crop could produce an exportable surplus of 5m tonnes. But that would face limited demand in an already over-supplied world market.