THE WHEAT MARKET
Total world wheat production in 2006 was nearly 600 million tonnes, with
Europe contributing about 125 million tonnes – nearly a quarter of total world
production. This world crop would cover an area nine times the size of the UK,
with each hectare cultivated producing an average of 2.3 tonnes.
The UK produces 15 million tonnes of wheat each year. Wheat grows best in dry
climates. It needs good, rich soil to produce the largest amount of grain. The
best crops are grown in the deep, rich soils of the east of England. Wheat is
sown on two fifths of Britain’s arable land, resulting in a total harvest of
12–17 million tonnes per year.
British farmers are among the most productive and efficient in the world. In
the UK, the average yield is about 8 tonnes per hectare. Cereal yields have
tripled in the last 50 years, with Britain holding the world record wheat yield.
Plant breeders continue to develop types of wheat that produce more grain, and
crop scientists and advisers are helping farmers to develop even more efficient
growing methods.
The UK wheat market
The pie chart shows how wheat grown in the UK is used. Most of the crop is
made into food for humans, but some is used for animal feed (for chickens, cows
and pigs) and a small percentage as seed to plant for the following year.
Traditionally the UK has been known for its biscuit or 'soft wheats'. More
recently, plant breeders have developed UK cereal varieties that are suitable
for breadmaking, allowing UK millers to use more home-grown wheat in place of
imported North American strong/hard wheats. Farmers decide what sort of wheat to
plant based on a number of variables: the prices available from local versus
export markets, likely transport costs, the premiums available for quality
attributes and competition.
Farmers have a number of marketing channels and increasingly they will grow
for a specific market. UK farmers may sell their grain direct to cereal
processors, through merchants or through farmer-controlled trading companies or
co-operatives. The largest of these handle more than four million tonnes of
grain each season. Some of these businesses export directly themselves while
others supply export markets through export traders or shippers.
Wheat and other cereals
Cereal crops are grasses that produce grains that humans and animals eat.
Several different types of cereal are grown in the UK: wheat, barley, oats,
maize and rice.
Wheat
- The UK currently produces 12–17 million tonnes of wheat each season.
- Flour made from wheat is used to make bread, biscuits and many other
food products.
- About 40% of the UK crop is used to feed animals such as pigs, chickens
and cows.
Barley
- Barley is the second most widely grown crop in the UK. Each year the UK
produces around 5 million tonnes and exports 10% of the crop.
- 50–60% of the UK crop is used to feed animals. Some of the rest is used
in the brewing and distilling industry to produce malt, beer and spirits.
Oats
- The UK produces around 700,000 tonnes of oats a year.
- About 60% is used for food products such as muesli, oat-based snacks and
multi-grain breads. More than a third of British oats are fed to animals,
including as a specialist feed for racehorses.
Farming and the economy
Wheat is the most widely grown cereal crop in the UK. Farming, of all types,
contributes in excess of £5 billion to the UK economy. The total labour force
employed in agriculture in the UK is 541,000. Overall, 1.8% of the UK’s
workforce is directly employed in farming.
Agriculture plays a crucial role in a number of ‘upstream’ and ‘downstream’
industries within the UK food chain. With an annual output of around £140
billion and generating some 3.8 million jobs, the UK food chain accounts for
almost 8% of the total economy and 14% of all employees in the UK.
Rural tourism contributes an estimated £14 billion to the economy.
Household expenditure on food and drink rose 2.2% from 2005–2006, from £23.05
per person per week to £23.56 per person per week. Cereal-based food expenditure
(e.g. on bread, breakfast cereals, etc.) rose 3.3%, from £3.76 per person per
week to £3.88 per person per week.
Farmers manage over 75% of the total land area of the UK. The land use for
one year (2006) is shown in the table. Farming means that the UK is 66.5%
self-sufficient in providing the food needed by the population.
| Land use |
Hectares (000s) |
Per cent (%) |
| Total crops |
4340 |
23.2 |
| Bare fallow |
150 |
0.8 |
| Set-aside scheme land |
513 |
2.7 |
| Grass leys (all grass under 5 years old) |
1137 |
6.1 |
| Permanent pasture (all grass over 5 years old) |
5967 |
31.9 |
| Rough grazing |
4491 |
24 |
| Other |
268 |
1.4 |
| Total agricultural area |
18,713 |
100 |
Farming issues
UK agriculture is experiencing a serious economic recession. All sectors have
been affected by a number of issues.
Farming incomes
Total income from farming in the UK in 2003 was estimated to be £3.2 billion.
It is now 77 per cent above the low point in 2000, when the average UK farmer
earned just £8267 from farming.
Prices
The collapse in world commodity prices at the end of the 1990s had a big
effect on farming; cereal prices fell 40% between 1995 and 2000. Following
recent reform of the CAP and a weaker Euro, EU grain prices have been brought
close to world levels for many grains. This means that a wider range of factors
from outside the EU now affect prices here in the UK.
Workforce
Farming employs 557,000 farmers and farm workers. Nearly 60,000 jobs were
lost in the UK's agricultural and horticultural industry in the three years to
June 2001. As the industry recession continues, many farmers are retiring so
there are skills shortages in the industry.
The Common Agricultural Policy (CAP)
The CAP was developed to ensure that European Countries could supply
themselves with food. The CAP offers guaranteed prices for farmed commodities,
but surplus crops meant that measures – such as 'set-aside' – were needed.
Set-aside means land that farmers are not allowed to use for any agricultural
purpose. They are paid a subsidy in return. Better technology means the 90% of
land being used is more productive, plus the set-aside land benefits bird,
mammal and insect populations.
