One of the problems writing this July article is a lot can happen before you read it.

But I am more confident in predicting that England’s involvement in the World Cup will probably be over before the quarter finals on 7 July than I am of the outcome of the Russian/Ukrainian Black Sea drought! Unusually, the United States Department of Agriculture were one of the first to downgrade the potential Russian wheat crop from the record 85 million tonnes last year to 72 million tonnes. Based on dry weather, this has been further reduced to 68 million – but on a reduced planting area.

So last year Russia was the biggest wheat exporter in the world, shipping nearly 40 million tonnes. That exploded the myth that they didn’t have the logistics and infrastructure to achieve this. But, whatever the reduction in Russian exports is, it’s likely to be picked up by the European Union – who were the big losers on export sales this year.

A large discrepancy has been discovered between DEFRA’s estimated planted area for UK wheat and barley in the June 2017 census figure and the basic payment scheme returns. This means that the UK industry has been including 46,000 hectares of wheat (about 362,000 tonnes) and 26,000 hectares of barley (about 188,000 metric tonnes) which didn’t exist. So it is no wonder that UK wheat and to a lesser extent barley have effectively run out already.

I have commented more than once over the past six months that the alleged surpluses of wheat and barley just didn’t seem to be there: now we know the reason why. So it’s been a real windfall for those who held on to some tonnage, but most didn’t. However, it’s also meant that there is an armada of foreign wheat arriving in the UK with more coming in the next six weeks.

As we approach new crop, this influx of imported wheat could top up the UK new crop balance sheet which was already looking tight. Again I have said many times that with say an average 2018 UK wheat harvest of 14.6 million tonnes, we would be at import parity for much of the year. That does not change, but early wheat imports to the UK could take the edge off consumer demand.

UK barley will be different to wheat. Spain have such a good crop that we won’t have the weekly coaster sales we had last year. So we should revert to a more normal demand for feed barley. That means we won’t see a repeat of the high values for barley compared to wheat that we have seen over the past few months. That said, barley is also tight globally. Unlike the wheat, the UK should have an exportable surplus, so we will have to trade at export price parity. That is likely to mean a few 60,000 tonne boats rather than the coasters. So patience between panamaxes will be required. Whichever way you cut this, so long as the UK achieves an average harvest with the prudent marketing already done and the good marketing opportunities I have forecast, you should be able to make a profit on all cereals this year, and it’s been some time since we could say that.

Don’t forget one thing: we are never short of wheat or barley at harvest time, so being able to store what you don’t have to move is important. The same can be said of October/November/December: there is always enough to go around. So if movement is important for those months, don’t forget to sell some forward. If we learned anything from this year, it’s that post Christmas, there are many potential big game changers, with or without dodgy DEFRA figures. We could run dry again; ethanol production could take off; you have Brexit; currency; and a possible USA/China tariff trade war!

So when watching the football in Russia keep an eye on the temperature and the rainfall (or lack of it). You have more chance of getting your marketing right this year than England have of progressing beyond the last 32 countries left in.