“There has never been a more important time to understand your costs of production or to improve performance.”
That was the take-home message from Tuesday’s Agriculture and Horticulture Development Board’s (AHDB) spring grain market outlook conference, which did not instill any hope of grain prices returning to prices over €300/t in the near term.
Viewers to the UK conference were told that while the impact of geo-politics will remain in the background, in general, grain markets have returned back to being affected by the fundamentals.
Wheat production is expected to increase in the EU, Canada, US and Argentina. Overall, global wheat production is large and opening stocks are up, while global maize production is expected to rebound.
In the near term, the Black Sea grain deal will add volatility to the market, but supply at present is high.
Megan Hesketh said that there will be substantial carry-over of wheat stocks in the UK and new crop production is expected to be relatively large.
Oilseed rape margins to drop
Looking at oilseeds and Anthony Speight stated that “the bears outweigh the bulls”.
The drought-hit Argentinian crop is expected to be accounted for by the record crop from their neighbours in Brazil.
Some reports place that crop, which is currently being exported, at 150 million tonnes.
US, Canadian, EU and Ukrainian oilseed production is also predicted to increase in 2023.
Australia is currently exporting a record 8.3 million tonnes of canola (oilseed rape), but this crop is expected to yield significantly less in 2023 at an estimated 5.4 million tonnes.
Figures on gross margins of UK crops placed winter oilseed rape as the top performer in 2022, but the forecast from the AHDB’s lead analyst on cereals and oilseeds Millie Askew was that winter oilseed rape will have the second lowest gross margin of 15 crops in 2023.
Askew outlined that fertiliser prices will continue to fall with natural gas prices, but she does not expect prices to fall to pre-war levels in the short term.
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