Assessing the weather impact - scenarios for 2019

Assessing the weather impact - scenarios for 2019

2018 is likely to be remembered for some extreme weather. The UK was not alone with much of Europe, Australia and America, also affected.

In livestock, lambing and spring calving faced very difficult conditions; the lamb crop was estimated to be around 990,000 head lower than in the previous year and calf registrations also declined. The pork sector faced higher feed prices; feed costs now accounting for over 60 per cent of cost of production. The other livestock sectors also felt these price increases. In addition, turnout was also hindered for all grazing livestock. For cereals producers, spring planting was delayed and yields down, with potato growers facing similar challenges. Fields without access to irrigation exacerbated yield impacts driven by the dry weather.

Drier than normal forecast

A recent report from the Met Office suggests that ordinarily, the chance of the UK experiencing a summer such as 2018 would be less than 0.5%. UK precipitation this winter has been below average, and the current forecast is for drier than normal conditions over the next couple of months. In addition, the outlook from the European Centre for Medium-Range Weather Forecasts is for a warmer and drier than average Q2 2019 for the UK, although it is not clear by how much.

Ground water levels are coming back up after being severely depleted over the summer. They are expected to be at roughly normal levels by the end of the winter, with the exception of chalk based soils. However, winter is a key time for refilling of reservoirs, and with “hands-off” flow conditions in place in some areas, refill rates could be detrimentally impacted for horticulture and potato growers.

Plan for the year ahead

With these conditions in mind, and with producers planning for the year ahead, it is prudent to outline some of the key issues that may be faced if different weather scenarios play out. While no-one has a crystal ball, being aware of some of the potential impacts could allow the industry to plan ahead accordingly, potentially mitigating some of the challenges experienced during 2018.

 

If the dry weather continues

More “normal” conditions resume

Cold conditions return

Dairy

  • Could be a positive, allowing for early turnout
  • However, if continues into grass growing season, could limit growth and mean supplementary feeding required
  • Unlikely to have significant short term impact as herds being fed on silage already cut
  • Any lack of grass compensated by supplementary feeding to maintain yields
  • Longer term, tighter margins and potential lack of silage could lead to herd reduction
  • While much of the feed will have been bought ahead and costed in, additional forage demands could tighten supply further, weighing on prices
  • Little impact on milk production
  • Some heat and moisture during key grass growing window could boost yields, although any deficit would be counteracted with supplementary feeding
  • Would alleviate some pressure on margins
  • May reduce pressure to selectively cull cows post-flush
  • Adult cows are generally cold-tolerant. However, if temperatures fall below zero and cows are not properly sheltered or they are wet or exposed to cold wind, the extra energy used by the cows to keep warm could affect yields and health; milk composition can change with a rise in butterfat
  • Calves born in this period may be weaker and have slower growth rates if not warmed and fed properly;
  • Risk of water freezing, impacting yields and creating challenges for farmers
  • Potential loss of milk due to difficulties in collecting
  • Delayed spring turn out possible if grass growth delayed. Supplementary feeding maybe necessary. While much of the feed will have been bought ahead and costed in, additional forage demands could tighten supply further, weighing on prices
  • Can be difficult to raise milk yields again if hit, thus causing delays to rises in volumes in the spring

Beef & Lamb

  • Could be a positive, allowing for early turnout
  • However, if continues into grass growing season, could limit growth and mean supplementary feeding required
  • Unlikely to have significant short term impact as herds being fed on silage already cut
  • Any lack of grass compensated by supplementary feeding to maintain weights
  • While much of the feed will have been bought ahead and costed in, additional forage demands could tighten supply further, weighing on prices. Already reports of forage prices being at record levels, although quality has held up, allowing forage to be bulked with lower quality feedstuffs
  • Longer term, tighter margins and potential lack of silage could lead to herd reduction. Cow slaughter has increased, although commercial reasons rather than weather impact have been the main driver of this. Therefore the breeding herd is expected to decline.
  • The ability to reduce forage requirements and supplementary feeding welcomed if early turnout an option. Much of this dependant on the rate of grass growth in the spring
  • Effects likely to be felt at lambing and spring calving survival rates, depending on when /where farms calf/lamb
  • Low lambing survival rates, coupled with potential of reduced conception at tupping could lead to tighter domestic sheep production
  • Supplementary feeding may be necessary. While much of the feed will have been bought ahead and costed in, additional forage demands could tighten supply further, weighing on prices. Already reports of forage prices being at record levels, although quality has held up, allowing forage to be bulked with lower quality feedstuffs

 

Cereals & Oilseeds

  • The dry weather to date has allowed for good drilling and crop establishment conditions. The wheat area has recorded its first increase since 2014. As such, greater production volumes are anticipated by the market for the 2019 harvest, with the price for Nov-19 reflecting this bearish sentiment
  • However, soil moisture levels may be a growing concern if the dryness continues through the key growing stages
  • If still dry through post winter application of N, potential to impact yield due to reduced uptake of N
  • A “reasonable” sized crop might expected, given the greater area planted to winter cereals this season
  • An increase of supply may weigh on price, as already indicated in Nov-19 futures price
  • Although the weather to date has allowed for more favourable drilling conditions and establishment, a cold snap could lead to frost damage in some crops. However, if snow accompanied, this would provide the crop with a layer of insulation
  • A significant frost damage could impact yields down the line

Potatoes

  • The continuation of dry weather would allow for more favourable planting conditions. This could potentially encourage an increase in planted area
  • However if dry weather persists, reservoirs that were run dry last summer will not get the opportunity to refill. This could impact later on in the season if they are needed
  • With only half of the planted area having access to irrigation, a repeat of last summer’s weather could once again adversely affect growers without irrigation. This resulted in yield and quality impacts.
  • More normal conditions would allow planting to commence as per usual, and may go some way to replenishing reservoir levels.
  • If growing conditions continued in a favourable fashion, this could pressurise prices somewhat, if the new crop looks to be developing well. Conversely, if the opposite is true, prices may be supported.
  • This could cause a delay in planting, which may impact the season ahead depending on the length of delay and the weather during the key growing window
  • However, an increase in rainfall will provide opportunities for reservoir refill

By thinking ahead to the different scenarios that could play out, it is possible to at least be aware, if not prepare, for any eventualities. Keeping an eye on market trends and forward planning will remain as important as ever. Sign up to AHDB’s regular Market Intelligence publications to follow how the weather continues to influence production and prices at comms@ahdb.org.uk