Following on from 55mm, or two inches of rain in my part of the Borders in July, some areas in August in the Borders reported 100mm, or four inches of rain in less than three days just last week.

However, it had been highly localised as some areas not many miles away from these cloudbursts had only 5mm over the same period.

This summer, Scotland has been even drier than the drought of 1976 which we all remember well for those of us who are old enough and Scotland has had only 54% of average summer rainfall, with the west of the country even drier at 46%.

This makes it the second driest summer ever recorded – the driest being in 1955 – and going forward this year warnings are for drought conditions for many areas including the far north where a significant scarcity of water has been flagged up.

Farmers in the South-west of Scotland have had the driest July in more than 100 years and if Scotland does not get a significant amount of rain in the next two weeks, it will become one of the top 10 driest summers ever. High pressure sitting out over the North Sea, means that it looked like the East of Scotland might not get any significant amount of rain in the next two weeks.

Sunday evening work at St Monans, Fife as the combine gets going in a crop of spring barley (Pic: Ron Stephen)

Sunday evening work at St Monans, Fife as the combine gets going in a crop of spring barley (Pic: Ron Stephen)

With harvest well underway, farmers will not be looking for rain soon and should allow crops to be gathered in with very little drying costs as fuel and gas are becoming even more expensive.

In July, the average price of red diesel was 66.0ppl which is 31% higher than a year ago and the highest price since November, 2018. Brent crude oil prices reached a peak of $77.16 per barrel on July 5 which was the highest since October, 2018, but have now eased back to $70.70 per barrel due to the strengthening of the US dollar, Covid-19 lockdowns in Asia, and sterling reaching its highest level against the euro since February, 2020, at £1 equating to €1.181.

The UK gas price was 9p per therm in May, 2020, and rose to 66p/therm in May, 2021, and it now sits at £1.15/therm. This has driven fertiliser prices 49% higher than they were in June, 2020 and 34.5% AN is now at its highest price since April, 2014.

As natural gas represents 60-80% of the variable input cost in the production of nitrogen fertiliser, prices are rising by approximately £10 per week at present. That's due to freight prices rising but not helped by India announcing a further purchase tender for more granular and prilled urea.

The cold start to spring 2021 ran down natural gas stocks in Europe and at the same time demand for gas had been rising as many countries around the world were cutting coal use and using more gas, which is cleaner.

This dry spell is not only happening in Scotland – many other countries are suffering badly from drought. One is Canada and this has seen rapeseed prices reach highs heading towards £500 per tonne.

Earlier last week delivered rape into Erith for November, 2021, was worth £466.50 and prices have been rising daily since by £5-£10 per tonne. These prices are the highest since at least 2005 and are £120/tonne higher than at the same time last year and £130/tonne than the five-year average.

Some of the reasons for this is that the season started with a relatively tight supply situation, along with the rapeseed harvest in Europe and Black Sea region being delayed and, more importantly that drought in Canada, which normally supplies more than 60% of the rapeseed required in Europe.

Canada's crop potential is getting worse as harvest progresses, with yield estimates now around 5m tonnes below the 16m tonne estimate of three months ago and 21m tonnes before that.

EU imports of rapeseed increased this season to 414,000 tonnes, which is up by 104,000 tonnes and normally much of this tonnage would have come from the Ukraine, but this year it has come from Australia where rain helped bolster crops.

Rising prices in global oilseeds markets in the last 18 months are also due to relentless Chinese buying, although China has not been in the market recently.

The oilseed rape harvest in the UK is now well underway and yields appear to be improving as the harvest moves North. Early on, yields were being reported at around 3.3t/ha but now they are as high as 5t/ha – even though crops are slow to ripen, with the slowest to start since 2015 and localised heavy downpours and hail have caused some pod damage.

The UK winter barley harvest progressed well with the generally dry weather and like the oilseed rape, yields and quality in the south of the country have improved as harvest moved further North into Scotland.

Low specific weights and below average yields were common in the south and in the North and West of England yields have generally been very good. Scotland achieved the best crop with high winter barley yields and a 65-66kg/hl average specific weight.

The spring malting barley harvest has now got underway and low nitrogen samples have been common. Screenings have been significantly better than those of winter malting barley and early yields look good.

Barley prices have risen significantly following sharp rises in wheat futures markets, more of which later. Most of these gains are due to concerns around world wheat supplies and barley’s discount to wheat has widened to £21 per tonne.

The USDA has cut its US maize yield estimates and will result in a 2021-22 crop that is 10.5m tonnes lower than what was estimated in July at 374.68m tonnes.

Some states in the US are looking at record yields whilst others which are ravaged by drought will have their worst crop in 10 years.

Overall, world maize production will be almost 9m tonnes down from July at a current 1.186bn tonnes, but this is still 71m tonnes up on last season. Consumption will be 41m tonnes up on last year and will see stocks rise by 4m tonnes on the year, but much will depend on having beneficial weather to achieve these figures.

The global outlook for wheat in 2021-22 is for reduced supplies, lower consumption and smaller ending stocks than last month. Ending stocks are now estimated at 279.1m tonnes, down 4% on last month and 3% below 2020-21.

Due to drought and other weather issues Russia has reduced its earlier forecast tonnage by 12.5m tonnes due in part to an update in planted area and lower yields but is still expected to be the world’s top exporter of wheat this season.

Russia has been seeing yields of 3.34t/ha this year compared to 3.66t/ha last harvest and as harvest progresses this yield figure could drop to as low as 2.5-2.75t/ha.

The Ukraine is reporting record yields, 14% higher than last year at 4.55t/ha and expect to produce around 33m tonnes and Australia is looking at an increased tonnage of 1.5m tonnes, up to 30m tonnes due to beneficial rainfall.

Canada has reduced its total wheat crop yield by 7.7m tonnes down to 24m tonnes due to drought across the prairies and will be their smallest wheat crop since 2010-11.

The US tonnage is forecast down by 1.3m tonnes due to dry weather and will be the lowest wheat crop in 19 years.

The UK is still looking to produce around 14.9m tonnes which is well up on their 9.6m tonnes last year and in France, wet weather has seen their wheat production drop to 36.69m tonnes, and it is estimated that as much as 50% of French wheat production could be downgraded to feed quality.

Overall world wheat production is seen 15.5m tonnes down on the July estimate to 776.91m tonnes which is still 1m tonnes up on last season and the estimate for consumption is seen 4m tonnes lower at 786.67m tonnes.

With the world using 10m tonnes more wheat than it is producing, stocks will be almost 10m tonnes down on the year at 279m tonnes which is 12.6m tonnes down on the July estimate.

As a result of all the weather issues worldwide and global wheat supply concerns the Liffee feed wheat futures have seen big rises over the past month.

On July 27, the November, 2021, wheat futures stood at £174.80 and as of August 17, the November, 2021, futures now stand at £192.50 which is down from £195 earlier.

May, 2022, futures on July 30 were at £186.60 and as of August 17 were hitting £198.50, but have been as high as £200.30 per tonne.

Barley use in feed rations is expected to remain strong this season due to a healthy price discount to wheat which currently stands at £21 per tonne. Full season use of wheat was the lowest since 2007-08 due to the wheat being replaced with barley.

Barley as a proportion of the feed diet was 40.7% up year-on-year and made up 23.7% of cereal ingredient.

Across the 2020-21 season ex-farm feed barley averaged a £44.30 discount to feed wheat, therefore if the use of cereals in animal feed continued at its current rate, barley in compound rations could reach around 1.16-1.24m tonnes next season.

Feed bean prices are following wheat and prices for feed beans of around £220 ex farm for November are achievable – there could also be an additional premium for human consumption grades.

Early harvested crops in the south have yielded 4-4.25 tonnes/ha which is good considering the crop has been cut earlier than normal. Quality has not been anything special, though, with a lot of small beans and quite high bruchid infestation levels.

Peas harvested earlier have seen good yields of up to five tonnes/ha with varying quality. If they have not been harvested early enough, they lose their colour and there is a price difference of over £75.