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Imports to weigh on domestic wheat price

Global trends are likely to influence UK wheat prices this season as the UK looks to imports after a small harvest.

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Imports to weigh on domestic wheat price

There was a huge range of yields and quality this year across the country, with Openfield analyst Cecilia Pryce highlighting the difficulties of estimating a crop number.

 

However, she said the quality of milling wheats seemed to ‘largely’ be holding up.

 

She added it would ‘take some time’ to sort the market out.

 

Ms Pryce said: “Harvest and then think hard, is probably the best way forward for many but remember that as much as we are an island, we have many port facilities and they import as well as they export.”

 

NFU North East combinable crops board chairman, Brett Askew said there seemed to have been a Covid-19 impact with no appetite to buy grain and he was surprised there was not a bigger lift in prices.


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He said: “In 2018 we were looking at a 12-14 million tonne wheat harvest and France 28mt and it was reaching £190-£200/tonne in August and September."

 

"So you would have thought with a UK crop of sub 10mt, and French crop sub 30mt, 9mt down on last year there would be an appetite there for buyers to secure wheat but they are not comfortable – are they switching to corn?”

 

Consumption

 

Mr Askew added it seemed there would be a huge carryout of corn and questioned if Covid-19 had impacted US bioethanol consumption.

 

The expected small harvest has sparked warnings of bread price rises.

 

Ms Pryce said: “The press has flooded the market with bread price rises but seemed to forget that grain also feeds livestock and many industrial consumers but alas we see no calls for meat, starch or ethanol price rises.”

 

The relationship between wheat and bread prices was also not as simple as it may seem, with AHDB head of market specialists for arable, David Eudall, estimating the value of wheat in an 800g loaf was only 11 per cent.

 

He said: “With a small harvest and increased imports, our domestic milling wheat prices have been moved higher.

 

“However, the price of a loaf on the shelf will be far more influenced by the need for supermarkets to keep consistent prices for consumers amid the record-breaking recession we face and possible deflation.”

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