Agri-commodity market tracking: UK wheat crop is the largest since 2019

16-Dec-2022 - Last updated on 16-Dec-2022 at 15:42 GMT

Related tags Wheat Defra barley Rosario Grain Exchange

Despite the hot and dry conditions experienced this summer in the UK, wheat, barley, oat, and oilseed rape yields are up on the year, finds AHDB’s review of new crop data.

The UK’s Department for Environment, Food and Rural Affairs (Defra) released its final estimates for 2022 UK cereal and oilseed production. In October, Defra was unable to publish provisional production estimates, due to reduced data availability from UK regions so yesterday’s release represents the first official production estimates for 2022.

With a slight increase in planted area (+1%) and a rise in yields, UK wheat production is estimated at 15.54Mt, up 11% on the year. Furthermore, this is the largest output since 2019 and 14% higher than the previous five-year average (2017-2021), said the AHDB team.

Total barley production is estimated at 7.385Mt, up 6% year-on-year and in line with the previous five-year average. “Despite larger yields for winter and spring crops, spring production is down on the year due to a smaller planted area.”

Oat production for harvest 2022 is estimated at 1.007Mt. "This is down 10% from last year’s large crop, which was the biggest this century, but up 2% from the previous five-year average."

Oilseed rape production is estimated at 1.36Mt, certainly higher than 2021 and 2020 levels of production, but still small from a historical perspective.

Looking to the southern hemisphere, and Argentinian wheat remains a concern, with the Rosario Grain Exchange trimming back their wheat crop forecast again for this season -2022-23. It estimates wheat production at 11.5Mt, 1Mt below the latest US Department's WASDE estimate, said CRM Agri analysts.

Export data

Also injecting a degree of support into wheat markets this week have been encouraging US export sale figures, with weekly US wheat export sales reaching 469Kt for 2022/2023, continued the CRM Agri outlook.

Weekly US corn net export sales also impressed with 958.9Kt of sales for 2022/2023. US soybeans export sales however were the most impressive at 2.943Mt of net sales, mostly to China (1.252Mt), reported that team.

Inflation cooling

“Adding into the mix of volatility has been currency, with inflation cooling in the US, EU and UK resulting in a weakening of the US dollar as the potential scale and aggressiveness of future rate hikes reduces.

“Later in the week, similar comments from the Bank of England also weighed on the pound, which was weaker against the dollar as inflation, despite still being high, begins to cool,” according to a CRM Agri weekly wrap-up.