Arable farmers need to plan now for a post-Brexit world and make sure they’re achieving the level of efficiency needed to keep them viable. What they mustn’t do is “wait and see,” delegates to Wednesday’s AHDB Grain Market Outlook conference heard.
Yorkshire grower Paul Temple, who chairs AHDB Cereals & Oilseeds, reminded delegates that there are only 17 months to go until the situation changes. “The wheat I’m putting in the ground now will be part of this new world,” he said. “It is really easy to simply feel lost and inclined to sit back and wait and see, but success will be about managing and facing change.”
Jack Watts, AHDB lead analyst, explained how UK wheat fits into the world market. “Over the last 18 months UK wheat has moved from some of the cheapest in the world to some of the most expensive,” he said. The decline in opening stocks had more than offset the big 2017 crop.
“You have got a balance that is down by half a million tonnes,” he said. “UK supply and demand is on a knife edge. You can no longer assume the UK will be a net exporter.” Cropping had changed, with a shift to spring crops. While more Group 1 and Group 2 wheat varieties were harvested in 2017, less was meeting the contract spec. “The big area of concern for me, when I look at the wheat market, is what’s happened to Group 3,” he said. That was where the export opportunities are. “The economic signals are there for farmers to grow more Group 3s,” he advised.
AHDB senior analyst Amandeep Kaur Purewal, predicted an exportable surplus of rapeseed in 2018/19, but there was uncertainty on the effect of biodiesel policy changes in the EU, which had as much potential to impact the UK’s key rapeseed market as Brexit.
Rapeseed would be exempt from many potential WTO tariffs after Brexit, but tariffs on oil could have indirect consequences, she warned, while non-tariff barriers could provide challenges.