Optimism for malting barley demand? Grain market daily

• Nov-25 UK feed wheat futures rose by £0.70/t yesterday, closing at £177.15/t. In contrast, the May-26 contract edged down £0.05/t, ending the day at £188.85/t.
• Global wheat prices showed mixed movements, influenced by short covering in Paris and profit-taking in Chicago ahead of the US Independence Day holiday. Paris milling wheat (Dec-25) gained 0.7%, while Chicago wheat (Dec-25) fell by 1.0%.
• Paris rapeseed futures (Nov-25) declined by €5.75/t to close at €482.50/t, following downward trends in Chicago soyabean oil and Winnipeg canola. The decline was driven by profit-taking and reports of strong yields from the ongoing European rapeseed harvest.

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AHDB yesterday published the latest UK human and industrial cereal usage figures for the 2024/25 season, covering the period to the end of May.

Barley usage by brewers, maltsters and distillers (BMD) saw a modest rise in May, up 12.9 Kt on the month, and 7.8 Kt on the same month a year earlier, to 156.4 Kt. May was the first month of the 2024/25 season that saw an increase in usage compared to 2023/24 levels. This slight uptick was likely buoyed somewhat by optimism following the India/UK trade deal. Warm and dry weather ordinarily supports alcohol sales and could also be a driving factor.

However, looking from July to May, usage remained notably lower year-on-year. Total usage stands at 1.63 Mt, down from 1.75 Mt over the same period in 2023/24, and below the five-year average of 1.69 Mt.

This decline is largely in line with expectations for the 2024/25 marketing year, with earlier forecasts indicating weaker demand in human and industrial (H&I) barley usage, primarily driven by the BMD sector. The ongoing cost-of-living pressures continue to weigh on consumer spending, while a long-term trend of reduced alcohol consumption among younger people is also affecting demand.

Premium remains steady

Ex-farm malting barley premiums remained relatively low throughout much of the 2024/25 season. According AHDB Corn Returns, the average ex-farm price for premium malting barley (spot delivery) was £172.20/t for the week ending 6 March (the latest available price). This was at just a £12.80/t premium to feed barley. 

Factors driving this lower premium include reduced demand from the BMD sector, sufficient supplies last season, and steady exports of both barley and malt.

Although slightly higher than in 2023/24, malt export volumes in the 2024/25 marketing year remain below the historical average. From July 2024 to April 2025, malt exports reached 94.5 Kt, 20% below the five-year average for the same period.

Looking ahead

As we head into the 2025/26 season, attention is now on prospects for the 2025 malting barley crop. According to the latest AHDB Planting and Variety Survey, the area of barley planted with varieties suitable for malting, brewing and distilling is expected to be smaller in 2025. Additionally,  spring barley crop condition ratings across the UK at the end of June were significantly below the same point last season.

As such, warm dry weather so far this summer, optimism linked to the UK-India trade deal, as well as a smaller malting barley harvest, could help support premiums to an extent in the coming season.

However, it’s important to note that barley carry-in stocks are expected to be significant, the cost of living is still impacting alcohol demand, and that alcohol consumption trends remain. Something to keep an eye on.

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