Tight supplies of grain across global markets could lead to significant price rises for livestock rations this winter, a representative from the local feed trade has warned.
Gill Gallagher from the NI Grain Trade Association (NIGTA) said price will not be the main factor influencing buying decisions when traders source ingredients over the coming months.
“Our number one priority is sourcing enough feed for the livestock on NI farms this winter. Unfortunately, price will be secondary to that,” she said.
Maize and wheat are by far the two most used straights in NI feed production, with over 500,000t of each used in local mills annually.
Gallagher said the Russian invasion of Ukraine is a major factor affecting international markets, but weather conditions in other grain growing regions could also cause disruption.
Around a third of all maize imported into NI comes from Ukraine, and most of this is bought over the winter. “At the minute, maize is available but there are concerns about where we will get it from at the back end of the year,” Gallagher said.
The ongoing war is also having a major bearing on wheat markets as Russia and Ukraine combined account for 30% of all wheat traded globally.
Gallagher said the conflict is making it more difficult for local traders to purchase wheat from any part of the world, even if they do not usually buy from either Russia or Ukraine. “We are all fishing in smaller pond,” she said.
It is estimated that 20m tonnes of last year’s grain is still in store in Ukraine, but sea blockades and damage to port infrastructure have effectively stopped all shipments.
The NIGTA chief executive said grain is “only trickling out of Ukraine” with up to 300,000t moving by rail monthly. Before the Russian invasion, five to six million tonnes of grain was typically shipped out of Ukraine every month.
Elsewhere, Gallagher said drought conditions in North America have delayed maize planting and put wheat crops under stress, while it remains unclear what impact the weather phenomenon La Niña will have on the South American harvest.
“The weather conditions happening there are something that we are acutely monitoring because it will have an effect on markets too,” she said during a fringe event at Balmoral Show last week.
Aside from turbulent grain markets, Gallagher said increased freight costs, rising energy costs and changes in currency markets could also contribute to higher prices for livestock feed.