Arable farmers are facing one of the toughest economic situations in recent years as deteriorating yields and quality at harvest added to serious price woes.
Wheat, barley and oilseed rape prices have all struggled to reach profitable levels during the past growing season. Last week’s Farmers Guardian reported quality deterioration as many UK farmers struggled to lift crops in bad weather.
With thoughts turning to planting, arable experts suggested confidence was low among farmers with the possibilities for major price increases thin in coming months.
Guy Gagen, chief arable adviser at the NFU, said farmers would have to produce world record yields to make profits.
“There is no profit in combinable crops,” he said. “Prices have been down [all season]. Farmers have been receiving less than £100 per tonne for delivered barley and wheat.
“Costs have not come down relative to this. If you look at all the relative surveys, arable profitability has got worse.”
Mr Gagen added it was a similar situation for oilseed rape, with most farmers not making any money.
The NFU has written to the EU Commission encouraging investigations into competition in the fertiliser market and the removal of tariff protection on nitrogen and phosphate from third-world countries.
“Importers maintain an annually increasing price,” he said. “What is interesting about fertiliser is there is an increasing gap between international prices for fertiliser compared to what farmers pay in the UK.”
He called for the ‘ambitions’ of those providing farm inputs to be curbed in reaction to lower commodity prices.
James Bolesworth, director at CRM AgriCommodities, said there was little indication wheat prices would rise further than £140/tonne in the short-term.
“Without a major weather incident globally, there is no reason why we would see markets rise,” he said.
Mr Bolesworth said a confirmed El Nino weather event has the potential to bring improved prices, but suggested the impact depended on the severity of implications to global crops.