Covid, EU exit and the pervasive influence of China on global commodities markets are all explored in AHDB’s latest Agri-Market Outlook.
AHDB’s biannual forecast of UK production, consumption and trade across livestock and arable sectors went live online today (29 January).
It is intended to help farmers, growers and wider industry assess the potential impacts on their sector to help them plan, prepare and budget for the year to come.
Phil Bicknell, Market Intelligence Director at AHDB, said the Outlook was one of the most challenging AHDB has ever produced, given the huge impact of Covid on both domestic demand and the economies of key markets. Disruptions to trade following the end of the EU exit transition period and the knock-on effects on farm are also factored into the Outlook.
Phil added: “As 2021 gathers pace, the ongoing impact of Covid means that uncertainty is again the backdrop as we take our regular look ahead at our farming sectors.
“That said, we do have pockets of clarity, particularly in relation to some headline policy areas that impact our industry, such as the continuation of tariff-free and quota-free trade between the UK and EU. That has been a critical issue for agriculture – the EU-27 is both the UK’s biggest customer and biggest supplier of a range of agricultural products.
“As much as policy impacts farming, the fundamentals of supply and demand remain key drivers. These are increasingly international in their scope and impact. I have no doubt that our future outside the EU will bring both opportunities and competition but I’m also conscious that it will bring increased exposure to market volatility.”
The Outlook looks in-depth at what the future may hold at a sector by sector level, as well as some of the longer-term policy drivers.
Highlights include: GB growers held potato stocks, as at end of November 2020, estimated at 3.27 million tonnes, 12.5 per cent more than 2019; stock levels up year-on-year for packing and bags but 12 per cent lower for processing material, suggesting processors holding stocks. Draw-down rates lower than five-year average; the challenging environment, including loss of foodservice due to Covid, loss of CIPC and phytosanitary barriers to seed potato exports to EU may see a contraction of planted area for 2021. For the full report visit ahdb.org.uk/agri-market-outlook