Monday Market Briefing - 10th July 2023

We saw the first winter barley harvested last weekend with test results between 64-67 kg/hl – indicating a high-yielding crop similar to last season. Rain stopped play in the fields mid-week, and we expect more catchy weather where farmers will be grabbing all available combining windows. OSR harvest still appears to be a couple weeks away.

Feed barley has been actively trading around £140/MT ex-farm for July movement; depressed values due to the quality situation in France. Large areas of South-West France are regularly drilled with autumn-sown spring barley – most of which qualifies for the malting market. This season, the high temperatures and dry weather experienced in the Spring (similar to Spain) has badly affected the barley grain-fill, leading to very poor retention levels. Latest estimates show around 200,000 MT of French malting barley which will now be tipped as feed. Following a 5-year hiatus, Australia and China are now back on positive trading terms again. This means France has lost their largest active buyer of barley, and instead is looking for more local export homes for feed barley into Iberia. While this is bad news for harvest feed barley values, malting premiums should remain robust into the autumn and beyond.

The high test results for winter barley is usually a good indicator of the specific weight for this season’s winter wheat crop. With lower input prices compared to last year, growers are feeding their milling wheat with sufficient nitrogen (including foliar) in order to capture the high milling premiums of £50-£55/MT currently available. However, premiums are capped by import values from Germany (including blended Ukrainian milling wheat), so a good yielding European milling wheat harvest may put pressure on new crop premiums.

Have a good week.