WHEAT

• Drought-hit US crop drives global supply fears

The United States Department of Agriculture’s (USDA) latest crop condition report has sent shockwaves through the wheat market, projecting the smallest US harvest since 1972. Total wheat production for the 2026/27 season is forecast at 42.5 million metric tonnes (mmt), a 21% decline from last year. With hard red winter wheat, key for bread-making, being particularly affected. Kansas yields have been pegged at just 1.05 tonnes per hectare, sharply below the five-year average of 3.6 tonnes per hectare. Drought conditions across the Plains continue to worsen, with temperatures expected to exceed 32°C this week, further stressing vulnerable crops. The most recent USDA crop ratings this week showed only 27% of the US winter wheat crop in ‘good/excellent’ condition, down from 28% last week.

• Australian production under threat

In Australia, one of the world’s top wheat exporters, planting reductions and escalating input costs are set to slash output. Analysts estimate hectarage could drop to 20%, while the harvest could shrink to as low as 21.3mmt,down 41% from last year’s 36mmt. Rising fertiliser costs, exacerbated by the closure of the Strait of Hormuz, have forced farmers to cut applications or switch to less input-intensive crops. Further compounding the outlook is the anticipated formation of El Niño, which threatens below-average rainfall across key cropping zones in New South Wales and Queensland. With Australia typically accounting for 5% of annual global wheat exports, reduced shipments from this region will add pressure to already tightening global supply chains.

• UK prices supported

For UK growers, late old crop demand, the war in the Middle East and dry weather in the US and Australia is providing support for prices. Tight global stocks and reduced exportable surpluses from the US and Australia could sustain upside potential for UK values. Rainfall has arrived over the last two weeks but has been very patchy with a large range in rainfall received. Oscillating futures markets in Europe and the Black Sea region has seen fund positions switching between short and long with no clear view forming. It’s estimated that funds are short of Chicago Board of Trade (CBOT) wheat but long of MATIF wheat. As the market digests worsening supply forecasts from major exporters, attention will remain on weather developments and their impact on production in the weeks ahead.

BARLEY

• Feed markets drift amid low old crop stocks and little fresh demand

Old crop feed barley markets remain supported amid tightening stocks moving into the later stages of the season. Fresh consumer demand, despite a wide discount to wheat, is difficult to come by in some areas. In the South West markets have been quiet for some time. Where consumers have been active, they have been largely covering hand-to-mouth, but more often finding that they don’t need to buy monthly top-ups. Comparing to autumn, where consumers were in regularly to top-up following strong demand. Further North, late comers to the market in Lincolnshire and Yorkshire, are coming into a market under significant pressure with consumers having little to do now before harvest.

• Maltsters not in a hurry, while farmers remain cautious on malting crops

Dry spring conditions have raised concerns over UK new crop malting quality and yields, but subdued domestic demand and export competitiveness limits any meaningful price recovery. Maltsters have good cover on from now until December 2026 at least, and with a combination of ample supply and weak demand it is giving them little incentive to come to the Especially, in the East of England this remains a big question, while there has been rainfall, it hasn’t been expected or desired quantities.

OSR

• Strong old crop demand, volatile oil prices and dry spring conditions

European rapeseed markets have remained relatively firm over the last week, with August MATIF futures continuing to trade well over the €500/t mark, despite broadly comfortable global new crop production expectations and vegetable oil supplies. The market has been supported by ongoing uncertainty around Black Sea weather, crude oil volatility and biodiesel demand. UK old crop values remain well supported by the country’s structural import requirement and tight domestic supply situation following several reduced production years. Attention in the UK is increasingly turning toward harvest 2026 crop potential. Crop conditions across much of England are generally viewed as favourable, particularly compared with the difficult establishment campaigns seen in recent seasons. Good autumn drilling conditions, reduced cabbage stem flea beetle pressure in several key regions and comparatively lower pigeon grazing losses have helped support crop development. Industry surveys continue to point toward a significant rebound in planted area for harvest 2026, with AHDB estimating a rise of around 30% year-on-year.

However, recent dry weather through April and early May is becoming an increasing talking point. While many OSR crops currently retain good biomass and pod set potential, lighter land areas are beginning to show moisture stress, particularly across eastern counties. On heavier land, crops are generally holding up well, although growers will be watching closely for rainfall over the coming fortnight as flowering progresses toward pod fill. AHDB has already noted declining condition ratings across wider UK arable crops following the drier April period. In the last week rainfall has been seen across much of the country but time will tell if these have been enough.

Overall, the rapeseed market continues to balance supportive geopolitics and crude oil picture against broader pressure from global oilseed supply and demand. For UK growers, the outlook currently remains cautiously optimistic, with improved crop establishment and larger planted area offering potential for a more meaningful domestic crop in 2026, provided moisture arrives at the right time during late flowering and seed fill.

FERTILISER

What a week in the fertiliser industry. Geopolitical tensions continue to add risk and uncertainty across global supply chains, yet the domestic market saw a decisive move as CF returned with their June/July Nitram offer. The combination of guaranteed UK supply, limited volumes, and the ongoing unpredictability of imported product meant the offer was taken up in full within the day. Larger volume buyers moved early, with many other customers stepping in to cover odd loads, clearing the allocation by mid‑morning. Additional July tonnes were released and quickly absorbed as well.

In contrast, imported AN remains available only in theory. While Middle Eastern and European offers exist, no importer can provide firm assurance on arrival dates until the situation in the region stabilises. This uncertainty continues to push buyers toward domestic tonnes where reliability is clearer.

Urea values remain broadly unchanged from last week, but the risk profile has increased. The market is thin, and sentiment is driven more by concerns over logistics and arrival timing than by price movement itself.

Liquid suppliers continue to watch the market closely. Despite UK AN values for June/July offering a reference point, no new‑season liquid offers have been released. At current levels, liquid struggles to compete with UK AN, leaving the sector in a holding pattern for now.

Overall, the week has been defined by the contrast between certainty and risk. Domestic supply offered clarity and was rewarded with full uptake, while imports remain clouded by geopolitical disruption and logistical uncertainty.

Please speak to your Frontier advisor or email us at info@frontierag.co.uk for more information or advice related to any of the topics and services mentioned in this report.

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