The decline in barley production forecasts in the EU and Australia has not yet supported purchase prices in Ukraine

The other day, the European Commission lowered the forecast for barley production in the EU in 2023 by 2.4 million tons to 49.7 million tons (52 million tons in 2022), while the harvest forecast for Australia was lowered the day before.

At the same time, the European Commission reduced the estimate of domestic consumption of barley in the EU by 1 million tons to 41 million tons (42 million last year), and final stocks by 2 million tons to 6.1 million tons, which will correspond to the level of 2022/23 MR. It is expected that the export of barley will increase compared to the previous season by 0.7 million tons to 10.2 million tons.

FAS USDA experts lowered the forecast for the barley harvest in Australia in 2023/24 MR to 10 million t (14.1 million t last year), but raised the export estimate by 500 thousand t to 5.5 million t (7.5 million t last year) in expected resumption of supplies to China against the background of uncertainty with exports from Ukraine.

The Ukrainian Hydrometeorological Center predicts that in 2023, Ukraine will reduce the production of grain crops compared to 2022 from 53 to 49.6 million tons, in particular barley - from 5.608 to 4.8 million tons (10 million tons in 2021). And UKAB experts estimate the barley harvest at 4.2 million tons.

In 2022/23 FY, Ukraine exported 2.7 million tons of barley (5.75 million tons in 2021/22 FY), and in the new season, exports will not exceed 2.5 million tons.

Purchase prices for barley fell to $130-140/t or UAH 5,200-5,500/t for deliveries to Danube ports, while at this time last year they reached $150-160/t, although exports through Black Sea ports were completely blocked. Asking prices for deliveries to the port of Constanta are $185/t, although last year they reached €220-250/t DAP.

Recently, demand prices have started to rise against the background of curbing sales by farmers, who primarily plan to sell rapeseed to replenish working capital, and to postpone the sale of wheat and barley until the volumes of the new harvest become clear.

We will remind that USDA experts in the June report increased the forecast of world barley production in 2023/24 MR by 0.6 million tons to 148 million tons (152 million tons in 2022/23 MR), in particular for Ukraine - by 0.5 to 6, 4 million tons, EU countries - by 0.25 to 52.85 million tons, the Russian Federation - by 0.1 to 19.6 million tons.

At the same time, the forecast for the world export of barley in 2023/24 was increased by 0.5 million tons to 18.1 million tons, in particular for Ukraine - by 0.2 to 2.5 million tons, the EU - by 0.2 to 7.1 million tons tons and Russian Federation - by 0.1 to 4.6 million tons.

The MARS agency estimates the harvest of barley in the Russian Federation in 2023 at 20.4 million tons, which will be 11% less than in 2022.