Will 2025 Be the Year UK Wheat Bounces Back?
Posted by Emma on 27th Feb 2025 Reading Time:
UK wheat production is poised for a recovery in 2025, offering a glimmer of hope to an industry battered by a challenging 2024. The Agriculture and Horticulture Development Board (AHDB) has released its latest Agri-market outlooks for cereals, forecasting an increase from last year's 11.1 million tonnes. Yet, beneath this cautiously optimistic projection lies a landscape of uncertainty—will this uptick be sufficient to meet expectations, or will unpredictable weather and market forces cast a shadow over the harvest?
A Forecast of Recovery
The AHDB's projections hinge on data from its Early Bird Survey (EBS)—a key indicator of planting intentions—combined with yield statistics from the past five years (2020-2024), as provided by Defra. Even in a low yield scenario, mirroring 2020's modest 7.0 tonnes per hectare, production is expected to rise, buoyed by a 5% rebound in the crop area. In a more promising outlook, using the average yield of 7.8 tonnes per hectare, output could reach approximately 12.5 million tonnes—a significant step up from 2024.
However, this forecast falls short of the 2019-2023 average of 13.9 million tonnes, prompting questions about the UK's ability to reclaim its former production heights. Adding intrigue, anecdotal reports suggest that farmers may have planted more wheat than the EBS captured. Helen Plant, an analyst at AHDB, noted, "Concerns over the wet start to the autumn sparked doubts about completing winter plantings, potentially leading to a higher sown area than reported." To account for this, the AHDB explored an alternative scenario, boosting the EBS area estimate by an additional 5%. Yet, even here, production would not reach the five-year average unless yields surpass expectations—a tall order given the season's rocky beginning.
Weather: The Make-or-Break Factor
The next few months will be pivotal. As spring drilling advances and winter crops mature, weather conditions will dictate whether yields hit the average or soar to the five-year maximum. After a soggy autumn disrupted planting schedules, achieving optimal results will demand exceptionally favourable conditions—a meteorological gamble that farmers know all too well. The AHDB's first crop condition report, due on 28 March 2025, will offer an early glimpse into the crops' health, while the Planting and Variety Survey, opening on 7 April 2025, will refine estimates of the sown area.
A Market in Flux
The broader market reflects this blend of hope and hesitation. UK feed wheat futures have recently softened, with the May-25 contract dropping £3.55 per tonne to a new low of £181.00 per tonne and the November-25 contract shedding £3.10 per tonne to close at £194.00 per tonne. Analysts attribute this decline to improved weather forecasts in major wheat-producing regions like the US and Russia, alongside stronger planting progress in Brazil and speculative selling in Chicago markets. Paris rapeseed futures followed suit, with the May-25 contract falling €6.75 per tonne to €523.50 per tonne and November-25 slipping €3.25 per tonne to €497.50 per tonne, pressured by declines in Winnipeg canola and Chicago soybean futures after rains eased concerns in Argentina.
Yet, a curious twist emerges: since late November 2024, new crop domestic feed wheat futures for November 2025 have traded at a premium to old crop prices. This anomaly signals market unease over both UK and global production prospects for 2025, compounded by the possibility of above-average UK stocks lingering at the end of the 2024/25 season. Adding to the complexity, rising natural gas prices over the winter threaten to drive up nitrogen fertiliser costs—a critical input for wheat growers. The AHDB plans to address this in a forthcoming fertiliser outlook, providing further clarity on the economic pressures farmers may face.
What Lies Ahead?
For UK wheat farmers, 2025 presents a paradox: a potential production increase tempered by lingering doubts. Will the weather cooperate to deliver the yields needed to capitalise on the expanded crop area? Can the market absorb this output without prices buckling under global supply dynamics? And how will farmers navigate rising input costs against uncertain returns? The AHDB urges growers to reflect on their marketing strategies for the 2025 harvest, weighing the crop's potential against budgeted expenses in a year that could redefine the industry's trajectory.
As spring approaches, all eyes will be on the fields—and the skies—awaiting answers to these pressing questions.