Tillage farmers received a much-needed reprieve with the recent spell of drier weather. Up until last week approximately 50% of the main cereal’s crops were harvested, with progress nationwide now closer to 70% at this stage. However, it came too late for many, with the recent storms and rainfall causing significant yield and quality reduction in areas. Some areas in the south and south east have received 160mm of rain in August, which is 60% more than the norm.
Yields continue to be very variable. Where crops had good potential there are reductions of up to 30% in yield due to the inclement weather throughout August. Some crops have yielded better than expected, however, in general straw yield has been very disappointing.
Grain prices have strengthened by €3 to €5/t, with green harvest prices for barley and wheat in the range of €145- €150/t and €165 – €170/t respectively. Prices have been helped by the strength of wheat and the surge in import maize prices. A stronger sterling and the broken harvest in the UK, have left farmers reluctant sellers which has also supported Irish prices. The future direction of Irish prices still depends on the international maize markets and the UK barley export situation in particular. The UK will have to import wheat but will most likely have to export barley.
With US maize prices increasing by 10% in recent weeks, the EU Commission has again removed the import levies on maize having only imposed the 5.48 €/t duty on 12th August.
Continuing large export sales of French Wheat and Barley to China has supported the FOB Creil price for malting barley. With only 2 weeks remaining of the pricing model, the average price remains at €173/t. Both the lack of, and excessive rainfall at crucial times in the season, along with the impact of Covid has left it a very poor year for malting barley production.
Irish Native / Import Dried Feed Prices 01/09/2020
|Spot €/t||Nov 2020 €/t|
|FOB Creil Malting Barley||173|
EU wheat prices have gained recently on continuing news of good demand and reduced wheat harvests in France, UK and the Ukraine. The Matif wheat price is at a five-month high of €188/t. Drought is still continuing to affect wheat planting in Argentina, however, these bullish signals in the market are tempered by the expectations of good harvests in parts of Eastern Europe, Russia, the US and Australia. In contrast to wheat, barley production in the EU is down only 2% compared to last season. With demand and supply quite balanced at this stage some commentators in the market think that grains may have peaked in the short term at least.
Chicago maize futures have climbed by over 16% in the past month reaching five-month highs. The continuing dry conditions in the US Midwest, and reduced production forecasts in the EU and Ukraine have lowered world maize output forecasts. Increased demand from China for US product has also helped to drive prices higher.
The second corn harvest in Brazil (Safrina harvest) is on track to reach expected output. Other factors which may cap corn prices are reduced ethanol demand in the US, high world production and the weakness in South American currencies which leaves these exports cheap in dollar terms
US soybean futures market rose by 6% in the past week due to the same factors which have affected maize. US sales to China are near record levels for this stage of the season. All protein and vegetable oils have risen in tandem. Regarding rapeseed, the jump in soybeans has supported the market however, good EU and Canadian production figures have capped any further gains.