April Arable Update

UK Plantings

This time last year we commented on the ‘excellent spring drilling conditions through to mid April coupled with the timely rain’.  This year is quite the opposite but the recent dry spell has allowed incredible spring drilling progress; the underlying moisture has turned the country green very fast and suddenly the once fallow and muddy land is looking productive.  This does not mean the problems are over, far from it, and many farms now require rain.  On others, the signs of thin crops, evidence of compaction, failed areas, and other problems clearly persist.

Most agronomists advise that whilst it might be a reasonable ambition, farmers who have spring barley on their farm for the first time in many years are unlikely to achieve a malting specification.  This is not only because their soil probably is not suited to low nitrogen grains, but also because the maltsters are likely to have the pick of the crop this year and could raise the bar on their purchasing requirements.  Premiums may reflect the high tonnage available to maltsters. Nevertheless, a crop of feed barley is far better than a fallow field for many producers.

Spring wheat has also been a popular choice of many this year to fill in the gap left by the undrilled winter wheat.  DEFRA does not survey the split between winter and spring wheat, so this will only ever be the industry’s best estimate.  These so far are ranging between 60,000 and 150,000 hectares.  Thus, not only will the wheat area come out as one single figure, but the crop yield will too.

The other spring crop that has been filling up much of the undrilled or un-established land is spring OSR.  Again, it is difficult to identify exactly how much has been (as is still being) drilled.  We could still see the UK have its second largest OSR area this year, albeit most likely with depressed yields.

Most winter crops are still a couple of weeks behind their ‘normal’ stage of growth in the year, but this does not mean harvest will be delayed.  Many agronomists have been pointing out that the crops are likely to grow through their relevant stages rather fast this year, making the timings of input applications arguably more important than normal.

Markets

It is at this time of year that the markets around the world switch their attention to the new crop supply and demand fundamentals; old crop prices take a lead from the forthcoming harvest values rather than vice versa previously.  The new crop is now either emerged from winter or been drilled and supply and demand forecasts are being published.

The US, being the main combinable crop exporter in the world, leads on influence as well as tonnage shipped.  So when the USDA publishes its crop planting forecasts (which have a reasonable track record of reliability), traders take notice and the market moves accordingly. This in itself might dent the accuracy of the crop forecasts as prices move and farmers respond to price signals.  The USDA claims that the determination farmers have to make up for the losses from last year’s extreme drought mean they are likely to drill a record high area of maize and soybeans.  This includes the highest maize area for almost 80 years and the fourth highest soybean area on record.  The majority of maize and soybean are grown in the Midwest States and compete for ground.  Economics plays a part in the battle for acreage, but the good planting conditions will encourage maize, being an earlier crop to drill.

In the EU, forecasters are generally expecting a rise in cereal crop-sizes this year, the largest increase being maize (8 million tonnes), but also wheat (3 million tonnes), with a small rise in oilseed production too (½ million tonne rise).  These figures are the recent forecasts of COCERAL, the EU Farmers Union.