Spring barley harvest in Europe

Better than expected | The quantitative results of the spring barley harvest in Europe have been better than expected in some regions. The harvests in Scandinavia and in the UK are the main contributors. In France and Germany, too, the results are better than initially expected, although the quality is quite heterogeneous after the hot and dry weather.

For France, the potential yield is estimated at between 2.9 million and 3.7 million tonnes. The quality brings uncertainty though, but the protein values should still meet the requirements of maltsters and brewers, and the screening shows strong differences.

In addition, French goods can only be delivered to Germany to a limited extent when water levels on the waterways are low, as they have been recently. The export surplus is estimated at 1.5 to 1.7 million tonnes. In Denmark, a good harvest was achieved this year thanks to timely rainfall. Some yields were well above the average of 6.5 t/ha, and the export surplus could be 0.9 million tonnes. While in Sweden similarly good growing conditions prevailed, there are fears of qualitative losses in Finland after heavy rainfall in August.

The United Kingdom reports good yields and good qualities compared to 2021. The lower acreage alone leads to a lower export potential of only about 400,000 t instead of up to 600,000 t otherwise. In Germany, the area was expanded and crop was also harvested early and dry. While the screening often fits, the protein content varies between less than 9.5 and more than 13 percent depending on the region.

The drought has led to very unsatisfactory yields in parts of Austria as well as regionally in the Slovak Republic. Austria expects a need for imports, Slovakia still hopes to break even. The Czech Republic expects a similarly high production as in 2021 and a large share of malting barley, of which about 300,000 to 400,000 t could be exported. Hungary reports large differences in both protein values and fears a need for imports. Poland, on the other hand, expects a good quality of its malting barley and an import demand of 250,000 to 300,000 t.

Outlook

From the current perspective, the market assumes that this year's crop from the EU could last for about 12.5 to 13 months. Even without surpluses from the 2021 harvest, the current supply situation is considered tight, but not worrying. A timely 2023 harvest would be reassuring.

However, a more pressing issue could become the availability of gas in the processing industry. There are already reports of reduced malting capacity or temporary shutdowns of brewing facilities for lack of gas. This could improve the supply of barley and possibly have a weakening effect on prices. On the other hand, the drought in China and its impact on the Chinese crop needs to be considered. With greater import demand, this could in turn have a stabilising effect on prices.

The difficult logistics also remain an issue. High freight rates are weighing on the market. However, contracts are often concluded for later dates from October onwards, when the situation on the waterways is likely to improve.