W40: Barley Update
In W40 in the barley landscape, the global barley production forecast has been increased by 0.8 million metric tons (mmt) to 143.8 mmt, reaching the lowest value since the 2018/19 season. Reductions for Canada (-0.7 mmt) were offset by increases for Russia (+0.7 mmt), Germany (+0.6 mmt) and Ukraine (+0.4 mmt). Production estimates for Argentina, Australia and France remain unchanged. Global consumption remained without significant changes reaching 146.9 mmt, below the previous cycle. While consumption decreases are projected for the European Union (EU) and Australia, increases are expected in Asia and North Africa. GLobal trade is expected to fall compared to the previous cycle, reaching 28.7 mmt. The global final stock was adjusted upwards by 1.5 mmt, to 22.2 mmt.
The European Commission reduced its estimate for the 2023 barley harvest by 200 thousand mt to 48.4 mmt, which is less than last year's figure of 51.5 mmt. The MARS September crop yield forecast for the EU estimates the average yield for the EU at 3.59 mt per hectare (ha). The highest average yields are expected in Ireland at 6.57 mt/ha and the lowest in Spain at 2.25 mt/ha. Average yields in Poland are expected to be 3.65 mt/ha compared to 3.95 mt/ha in 2022, 8% less than in 2022 but 6% more than the five-year average. W40 in the European barley is losing ground due to the decline in exports and the reduced demand from feed mills.
Regarding prices in Europe, the price of barley in the Zamora market in Spain increased by USD 1.05 (EUR 1) to USD 231/mt (EUR 220). In France the price of barley decreased by almost USD 21 in the past month to USD 228/mt (EUR 217). The price of barley in Bologna, Italy remains anchored at USD 223 to 218/mt (EUR 207-212), 37% lower compared to last year. In Romania barley traded at USD 187/mt (EUR 178) in W40. Lastly, in Turkey the weekly average price of barley was USD 209/mt, while the FOB Black Sea price was USD 178/mt.
In Ukraine, since the beginning of October, agricultural farms in all regions are sowing winter crops. 2,992 thousand ha have already been sown including 109 thousand ha of barley. The Ministry of Agrarian Policy and Food of Ukraine has increased the forecast for gross production of grains and oilseeds to 79.1 mmt due to favorable weather. According to preliminary estimates farmers will be able to harvest 5.7 mmt of barley. Furthermore, Ukrainian farmers threshed 46.7 million tons of grain and oil crops as of the first week of October including 5.863 mmt of barley from 1.505 ha, resulting in a yield of 39.0 mt/ha.
Ukraine's grain exports have fallen 27.8% to 6.92 mmt so far in the 2023/24 season compared with 9.63 mmt in the same period of 2022/23. 249 thousand mt of grain were exported in the first five days of October compared to 932 thousand mt last year. Traders and farmers' unions have said the blockade of Ukrainian Black Sea ports and Russian attacks on Ukrainian ports on the Danube River are the main reasons for the reduction in exports. The Export volume includes 3.5 mmt of wheat, 2.8 mmt of corn and 635 thousand mt of barley.
As of October 5, 2023, Russian farmers harvested more than 133.5 mmt of grain, which is 15 mmt lower than the same period last year. According to the Russian Ministry of Agriculture, farmers harvested 22 mmt of barley. Regarding exports, in September 2023, 6.99 mmt of grain were exported, which is 17.6% more than in September last year. Barley shipments in September were practically the same as last year at 790 thousand mt. Furthermore, the duty rate for barley exports from Russia from October 11 will decrease to USD 11.93/mt from USD 12.8/mt and will be valid until October 17. Lastly, from October 1 to December 31, 2023, Russia may limit the import of seeds of nine agricultural crops including wheat, corn, barley, rye, potatoes, soybeans, canola, sunflower and sugar beets as per government decree of June 26, 2023. An exception will be the corresponding products from the countries of the Eurasian Economic Union (EAEU).