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The premium for growing malting barley has decreased over the last year, as the UK market is well supplied with high-quality spring crops. The winter barley area in England decreased by 17% for the 2023/24 season due to challenging planting conditions, leading to a surge in spring drilling and a 28% increase in the total spring barley area. Despite lower yields for winter barley, the harvest conditions for spring barley have been favorable, resulting in good yields and better quality crops.
Ex-farm malting barley prices were at £172/t in September, down nearly £60/t from the previous year. The premium over feed barley has also narrowed from £70/t to just £18.90/t. Grain traders at Simpsons Malt noted that supplies of spring barley are plentiful, outstripping demand in the short term and shifting power from the seller to the buyer. With global agricultural commodity prices trending lower, the UK farmer may face challenges.
Traders caution that the current low prices could impact cropping decisions, potentially leading to a smaller harvest area for barley next year and tighter supplies in the long term. Higher nitrogen levels required for continental malting could also pose challenges for exporting UK barley. Feed barley is facing tough competition in the global export market, with ample supplies from the Black Sea region and a £23/t discount to feed wheat.
Low farmgate prices and a difficult growing year may prompt farm businesses to allocate more land to Sustainable Farming Incentive schemes, offering a more stable return.
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Maria Sanchez completed her Bachelor’s degree in Plant Sciences from the University of California, Davis, in the USA. Her studies focused on plant genetics and biotechnology, with an emphasis on developing disease-resistant crop varieties. Maria has contributed to several research projects aimed at improving crop resilience to climate change and is now pursuing her Master’s degree in Plant Breeding.
