Malting barley prices are at their lowest since last July following downward pressure to EU markets and a falling pound.

According to the latest report from HGCA, predictions by USDA were reduced by 200 Kt last month following a slowing down in exports.

Similarly, a falling pound against the Euro has added more problems as imports, mainly fuel and machinery, are becoming more expensive. A loss in the UK’s AAA credit rating meant the pound fell heavily and this has had negative effects on trade.

Political influence from the Italian election caused some weakening of the euro, as no clear winner was found, although the Euro still remains strong when put against the pound.

While the price of malting barley remains poor, some hope could be found in world markets, with China expected to import 2.5Mt of barley this year. This quantity is similar to levels seen in 2012 and are expected to be sourced from Australia, Canada and Argentina. In Ukraine, it’s estimated that there is a 16.5% drop in the total winter and spring cropped area with just over 8Mt of barley is forecast to be produced. Therefore price increases maybe seen however the market will remain fairly volatile.