Another month has flown by with relatively mild weather for the time of year and winter sown crops look healthy, having emerged and grown well over the past few weeks.

Most fieldwork would appear to have been completed in good time and bodes well for good harvest yields next year!.

There have been some exports of malting barley this month and more exports are expected. Malting barley prices in England have been £50-£60 per tonne above feed prices and the UK has an exportable surplus of around 550,000-600,000 tonnes available and so far, around 200,000 tonnes have been sold.

Read more: Doug Niven: Harvest is almost a wrap and price remain stable

Looking forward to harvest 2022, the malting premium over feed barley is around £50 per tonne – the highest forward premium for many a year. Given fast rising increasing fertiliser costs it is thought that the area of spring barley next year could increase by at least 5%.

Defra released its provisional data for this past harvest and Scotland has fared better than England regarding wheat crop yield and quality. The UK wheat crop has been estimated at 14.02m tonnes based on an average yield of 7.8t/ha, which is below the five-year average of 8t/ha but is up from last year’s 9.7m tonnes and yield of 7t/ha.

That said, the Scottish average wheat yield is reported at 9.2t/ha – the second highest on record. Balancing that across the UK, yields in the south and east of England are below average and is due to higher rainfall, higher moisture levels resulting in lower specific weights.

With a planted wheat area last year of 1.79m ha and lower average yield, this means that the UK will again need relatively high grain imports. In turn, UK prices will not need to fall to competitive levels in export markets to clear any surplus, as previously thought.

More wheat will now be required when a bioethanol plant in Hull restarts production again next year after closing in 2018. This is due to a new government mandate stipulating that the compulsory inclusion of ethanol blends in fossil fuels will rise from 5% to 10%, which came into effect last month.

Increased domestic use will also come from the animal sector where wheat will regain some of the market share it lost last season to cheaper barley and imported maize.

The Liffee feed wheat futures remain strong with November, 2021, at £207 per tonne; March, 2022, at £212.10; May, 2022, at £219; and November, 2022, new crop wheat futures currently standing at £191.50 per tonne.

Looking towards the EU, export pace from there is keeping prices high, as they have now exported 8.671m tonnes so far this season, which is 2.3m tonnes up on last year at this time and could see exports exceed 10m tonnes by the end of this month.

A weakening euro has helped price competitiveness into export markets, as have tight supplies amongst other major exporters.

Read more: Doug Niven: Breakfast boost makes oats a star performer

Algeria will be importing a lot of EU wheat as it requires up to 8m tonnes following a 38% drop in output from last year. China is also expected to import a large wheat tonnage from the EU, even though it is the largest wheat producing country with an estimated total production this year of 136.9m tonnes.

There are, however, weather issues at present in China due to persistent heavy rain and this has resulted in only managing to plant 26% of its crop to date, which would normally at this time be around 53% completed.

Chinese annual consumption this year is forecast to be up to 149m tonnes, but their wheat stocks are expected top fall to 141m tonnes which equates to just over half of the world’s total stocks, despite 10m tonnes of it being imported.

Russian wheat exports at the end of September are forecast to be 17m tonnes, which is 4m tonnes less than last year for the same period. So far, this month exports have totalled 1.2m tonnes, which is half the amount moved last year in October.

It is thought that the both the EU and Russia together will export 35m tonnes of wheat this season, even given Russia’s export tax quotas limiting its export tonnage.

Canada will only produce around 21m tonnes this year, which will be 14m tonnes down on last year due to prolonged heat and dry weather. This will result in world wheat production being 775.87m tonnes – a figure which takes world stocks down to their lowest level since 2016-17.

The stocks-to-use ratio of the crop is 35.2%, which is the tightest since 2015-16 and excluding China, stocks-to-use to its tightest point since 2007-08. This increased tightness stems from reduced global wheat stocks sitting at 277m tonnes, or 11m tonnes down on the year and the lowest since 2016-17.

While wheat stocks are tighter, maize stocks both in China and the US were reported as higher than last year, resulting in global maize stocks up by 12m tonnes from last year.

The UK harvested around 1.15m tonnes of oats this year which is up 11% from 2020 and is the biggest UK oat crop since 1972. The planted area fell by 5% to an estimated 199,000ha but the tonnage was increased by higher yields in England.

The oat yield in Scotland was unchanged from last year’s record and the UK average yield, including both winter and spring oats is put at 5.5t/ha which is 17% higher than last year’s figure and above the five-year average of 5.4t/ha.

Due to the increased tonnage produced this year, ex-farm feed oat prices are more than £40 per tonne below those for feed barley and will see more oats being used for animal feed.

The UK barley crop for this year is around 1m tonnes down on last year at 7.1m tonnes due to a smaller spring barley area in England. South of the Border, winter barley tonnage was up by 36% due in part to having a 12% yield increase over last year and their spring barley area was down by 41% to 471,000ha as the remaining area was planted with wheat.

The Scottish spring barley area was down 4% and even though our barley output was down, it was still above average and the smaller UK crop, coupled with higher ex-farm barley prices means less barley is likely to be used for animal feed this coming winter.

Feed barley values firmed due to strong demand, but barley is still holding a small price discount to wheat as feed inclusion rates remain high in livestock rations and especially for pigs that recently have been unable to move off farm.

Granular urea fertiliser prices continue to rise by about £25 per week as freight costs continue to rise. Urea demand from India and restrictions on exports from some urea producing countries also means prices are expected to continue to rise further – recently, granular urea was being priced on farm in excess of £700 per tonne delivered in a bag.

Gas prices remain volatile in Europe and the UK. Earlier this month, they increased by 473% over the 41p/therm of October, 2020, to a high of £2.35/therm this October – this will see ammonium nitrate production plants remain closed for the foreseeable future.

Bean prices have continued to rise as spot demand and limited farm selling keeps prices firm.While the crop has been of poorer quality in the south of England, with premiums only £20-25 per tonne, further north and into Scotland beans have been better and have been sold ex farm at around £260-275 per tonne for best quality samples.

UK rapeseed production fell below 1m tonnes for the first time since 1989, 32 years ago, to 977,000 tonnes and this total is 6% lower than in 2020 and the 20% drop in area was only partly offset by better yields.

The average yield at 3.2t/ha is forecast better than last year’s figure of 2.7t/ha but is below the five-year average of 3.3t/ha.

Rapeseed prices have been increasing faster than soybeans and November, 2021, Paris rapeseed futures last week reached a record high figure of €700 and UK prices rose by £15 per tonne as a result.

Oilseed rape delivered November into Erith, last week, was quoted at £567.50 per tonne and at the same time soyabean prices have been dropping. This is due to forecasted larger Brazilian and US crops.

The recent surge in rapeseed prices has been driven by tight supplies of oilseed and palm oil, plus a rise in crude oil. Malaysian palm oil futures have risen by 9% and Brent crude oil by 6%.

Read more: Doug Niven: Oilseed rape heading to be a star crop in 2021

Canada is not expecting a large canola (OSR) crop this year, as previously well documented due to dry and hot conditions severely damaging the crop. However, Australia is looking to export 5m tonnes which would be an 11.3% increase later this year which will help to replenish the low rapeseed stocks and might slow down the recent record high prices.

One final factor that could affect prices, is a report that China’s soyabean consumption last year was down by 900,000 tonnes which raised the country’s year end stocks. So, no one appears to know what its buying requirements are for this coming season and whatever it decides to do will have a say in which way soya and rapeseed prices go in future.