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.

British farmers are among the most productive and efficient in the world. Wheat is sown on two fifths of Britain’s arable land, resulting in a total harvest of 12–17 million tonnes per year. 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 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 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 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:

• prices available from local versus export markets
• transport costs
• premiums available for quality attributes
• competition.

Farmers have a number of marketing channels and increasingly they 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 use 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

• 12–17 million tonnes of wheat produced in UK 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.

THE WHEAT BUSINESS

Wheat is sown on two-fifths of Britain’s arable land, and there is a total harvest of 13–17 million tonnes per year. Wheat is the most widely grown cereal crop in the UK.

Farming and the economy

Farming, of all types, contributes over £5 billion to the UK economy. The total labour force employed in agriculture in the UK is 531,000. Overall, 1.7% 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. The rural economy is worth £300 billion each year and employs 5.5 million people. 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 £3.5billion (25% of all tourism) to the UK economy (measuring accommodation spend only).

Average spend per household on groceries rose 3% from 2008-2009, from £3,412 per household per year to £3,550 per household per year. Average spend per household on bread rose 2%, from £74 per household per year to £76 per household per year. Average spend per household on breakfast cereals rose 6%, from £59 per household per year to £62 per household per year.^*

Using the land

Farmers manage over 75% of the total land area of the UK. Total agricultural area in the UK for 2009 is 18.752Mha. Here is the land use for one year (2009).

Wheat and other cereals

Cereal crops are grasses that produce grains that humans and animals eat. There are several different types of cereal: wheat, barley, oats, maize and rice.

Wheat

• The UK currently produces 13–17 million tonnes of wheat each season and exports about 17% of the crop.
• About 44% of the UK crop is used to feed animals such as pigs, chickens and cows. The remainder is used for human and industrial consumption.
• Flour made from wheat is used to make bread, biscuits and many other food products.

Barley

• Barley is the second most widely grown crop in the UK. Each year the UK produces around 5-6 million tonnes and exports about 11% of the crop.
• 50–55% 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 600-700,000 tonnes of oats a year.
• About 58-60% 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 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 is estimated to have risen by 41.9% in current prices in 2008 to £3.46 billion. It is now 77 per cent above the low point in 2000, when the average UK farmer earned just £8267 from farming.

Workforce

Farming employs 531,000 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 meant land that farmers were not allowed to use for any agricultural purpose. They were paid a subsidy in return for maintaining the land in good environmental condition. The set-aside scheme ended in 2007.

Farmers and the environment

As concerns about climate change and the impact of humans on the environment increase, farmers need to be aware of the effect their activities have on the land. Find out more here.

^*Source: TNS Worldpanel, 52 w/e 29 Nov 2009 vs. Yr Ago

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