Autumn is with us – temperatures have started to drop and daylight hours suddenly reduce quickly as we passed the September equinox which tends to bring more gales!

Some areas have had up to 100mm, or four inches of rain so far this month but still well down on the average rainfall figures for the year to date.

Autumn sowing has been going well and fields look good with a nice green crop cover which helps to make the countryside colourful following post-harvest operations. Potato harvesting is also well underway but any crops that were not irrigated are producing very low yields, but the recent rain has helped the harvesters to operate better.

Global and domestic wheat futures have been on the rise over the past few weeks due to concerns for global maize production and the escalating tensions between Russia and Ukraine and have been at their highest point since July 11.

Since August 1, the November, 2022, Liffee feed wheat futures have risen from £267 per tonne to their current level of £283.50 which is a rise of £16 per tonne and over the past two weeks up by £7 per tonne.

It is a similar story for other months, but for May, 2023, the increase over the same period is £20 per tonne to stand at present at £291 per tonne and up £11 over the past two weeks.

There are concerns as to how much grain will be allowed to leave Ukraine as tensions between the two countries increased again, with Russia mobilising more troops and encouraging referendums to try to claim more land from Ukraine.

At the same time, estimates of this year’s Russian wheat harvest have been increased to 99m tonnes and could result in an export tonnage of 47m tonnes. Ukraine is looking to plant around 3.8m ha of wheat this autumn, which would be a reduction of 20% meaning its 2023 wheat harvest could reach somewhere between 16 and 18m tonnes, compared to this year which was 19m tonnes. Farmers were only able to harvest 4.6m ha due to Russian military occupation and in 2020 harvested around 35m tonnes.

Earlier this month, the EU had exported a total of 8.1m tonnes of wheat during the first 10 weeks of the 2022-23 season, with France contributing more than 3m tonnes of this total. If exports continue at this pace, it would see 33.5m tonnes of exports, which would not be sustainable to maintain a carryover stock and the total is likely to be nearer to 29m tonnes.

Russia exported 3.5m tonnes of wheat in August and is expected to send around 4.4m tonnes in September and the next nine months could see a total of 47m tonnes leave Russia.

The International Grains Council increased its 2022-23 global wheat production forecast by 14m tonnes, up to 792m tonnes, on the back of increased Russian production and an increase from 7.7m tonnes to 10.9m tonnes of wheat in Brazil, which also imported approximately 6.5m tonnes of wheat from Argentina, where they are currently suffering from dry weather and have cut wheat production forecasts down to 16.5m tonnes.

In July, the UK exported 51,500 tonnes of wheat and 100,300 tonnes of barley to the EU and compared to the same point last year, this was up 35,200 and 86,600 tonnes respectively.

Prices increased on the back of futures prices and delivered feed wheat in England for October was quoted last week at £269.50 per tonne, or up £5 on the week. Bread wheat delivered for October was quoted at £334.50, which was up £4.50 per tonne on the week.

UK milling wheat premiums have been strong over the past few months due to concerns over the quality and quantity of available milling wheat this season.

The UK normally imports around 15% of the total amount used to produce flour each year, with Germany and France traditionally the main sources, but they both have had protein content issues, so there could be a problem with this usual trade.

As mentioned, one of the reasons for rising wheat futures was the lower maize production figures for this season which indicated US maize production down by 10.5m tonnes due to a lower harvested area, down by 1m ha to 80.8m ha.

The EU maize crop was also estimated down by 1.2m tonnes to 58.8m tonnes, which included France at 11.6m tonnes – its smallest maize crop for 32 years.

That all means that world maize production will be down by 7m tonnes to 1172m tonnes, as there is expected to be a 3m tonne maize increase in China, up to 274m tonnes, also an increase of 1.5m tonnes in Ukraine which with a 4m tonne cut in world consumption will leave global end maize stocks just 2m tonnes lower at 304.5m tonnes, which would be 7.5m tonnes down on last year.

EU and US exports for 2022-23 are forecast down 53.4% which is 3.1m tonnes and 8.1% ,5.1m tonnes, respectively, from last year and the market will be relying on the large South American supplies coming to the market going into 2023.

There is, however, no guarantee of crops as planting has only just begun in South America and they are about to head into the third successive year of La Nina weather which brings dry and cold weather to the region, and this could see farmers switching intended maize acreage to soybeans instead.

With maize supplies already tight in the Northern Hemisphere any extreme weather in the South Pacific will affect maize prices later in the season.

There has been very little demand for feed or malting barley either in the domestic or export markets and there seems to be ample malting supplies for the rest of this year which is seeing the discount between feed wheat and feed barley widening again.

With a large exportable surplus of malting barley, exports will need to continue throughout the season but currently UK malting barley is at a premium over Scandinavian barley. This is due to Danish malting barley being perceived to be too low in nitrogen and the UK’s quality deemed more suitable for brewing demand.

As with barley, the pea and feed bean market is quiet as more tonnage comes onto the market in October and November, resulting in prices falling in comparison to wheat futures. There is still minimal demand for human consumption beans either, despite weaker sterling. However, a weaker pound against the dollar would make importing proteins a more expensive option for compound feed buyers.

The rapeseed market has risen by £10 this past week and again this is due to issues in Ukraine and concerns about a smaller than expected Canadian canola crop, which saw the Paris Matif futures rise by €25 per tonne last week.

The Canadian government is still looking at a crop of 19.5m tonnes, which would be up 38.8% from 2021 but this will become clearer as harvest progresses. The rapeseed market currently feels well supplied going into winter as supplies come from both Canada and Australia but there is just this concern for the outcome of the Canadian canola harvest.

The fertiliser market has been quiet this past week or so as farmers continue to get autumn crops planted. The urea price has firmed in the UK again, mainly due to exchange rates and ammonium nitrate prices are also up as well.

Many European factories that produce AN are still closed as a result of high gas prices causing material supply issues. India is looking to buy a substantial tonnage of urea amounting, around 900,000 tonnes, which can only help to keep world supplies short.

The continued closure of the crucial Nord Stream 1 pipeline is not helping the situation either and only helps to keep supplies scarce and prices up. Natural gas makes up around 60-80% of fertiliser production costs in Europe and is the reason that some manufacturers have either paused or ceased production at this time.