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388: Agri Market Outlook - Arable
Written by Agriculture and Horticulture Development Board
The latest Cereals and Oilseeds Agri Market Outlook takes stock of the current situation and looks forward to what we might expect in the coming months for supply availability, trade and demand.
In this episode of the Food & Farming podcast, AHDB’s John Bates talks with Sarah Baker, Senior Strategic Insight Manager, Megan Hesketh, Senior Analyst (Cereals and Oilseeds), and Anthony Speight, Senior Analyst (Cereals and Oilseeds), to discuss the Argi Market Outlook for Arable.
Key findings for Cereals and Oilseeds
Cereals:
- Despite an increase in domestic wheat and barley availability this season, global price strength continues to provide a support level for domestic grain values. Price volatility is expected to continue, with a finely balanced global supply and demand and the war ongoing in Ukraine.
- Domestic winter crops for harvest 2023 are faring well, though fertiliser cost and application remain a key watchpoint.
- Exports are forecast stronger year on year for wheat and barley due to increased domestic grain availability. Oat export forecasts remain historically strong, though this season’s levels will be led by farmer selling and competitiveness on the global market.
- Animal feed demand, and cereal usage, are expected to fall this season, considering sector challenges from high input costs to Avian Flu. Brewing, malting, and distilling cereal usage is forecasted strong, with increased capacity coming online. A key domestic demand watchpoint remains bioethanol cereal usage, considering high costs and lower ethanol prices
- An increase in domestic production for rapeseed will slightly reduce the demand for imports. However, imports are forecast to remain historically high due to the UK domestic demand outweighing domestic production
- A sizable increase in area for harvest 2023 is forecast in reaction to the historically high prices over the past 18 months. Crops are faring well, although there are reports of area loss due to ongoing pest pressure
- Global supply and demand of rapeseed have both increased on the year. Increased availability in the EU is adding to price pressure and improving processor margins. EU crush demand is increasing on the year.
- Domestically, demand is expected to remain strong despite the closure of Hull at the end of 2022.
- Ultimately, rapeseed prices over the next six months will largely be driven by the direction of the soybean market, which awaits a historically high South American crop
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This episode was edited by Chloe Kimberley, Marcomms Executive (Cereals & Oilseeds).
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