A Quiet Case for OSR
The recently announced UK/US trade agreement has already sparked plenty of headlines, many of them focused on the potential risks to British agriculture. One issue that’s flying slightly under the radar, however, is the potential impact on domestic demand for feed wheat and what that means for cropping decisions going forward.
At the heart of this concern is the expected rise in ethanol imports from the US. These biofuels, made largely from maize or wheat, are blended into petrol at rates of 5 to10%, look for E5 or E10 next time you're filling up your car. Up to now, the UK has produced a fair amount of ethanol at home, using domestic feed wheat as the primary feedstock. But that could change.
Plants like Vivergo and Ensus, responsible for processing around 1.2 million tonnes of wheat between them, are likely to face increased pressure from cheaper US imports. One of those plants was already reported to be considering a slowdown or mothballing even before this deal was on the table.
Should these plants reduce output or close altogether, it would create a significant shortfall in domestic wheat demand, potentially forcing more UK wheat onto the export market. This would expose growers to global volatility at a time when forward markets are already looking less than inspiring.
Rethinking the Rotation
With that in mind, it’s worth taking stock of cropping plans, not just from a gross margin point of view, but in terms of how to spread market risk.
Oilseed rape (OSR) has had its ups and downs in recent seasons, and growers have been cautious about its place in the rotation. But one of OSR’s quiet strengths is that it isn’t exposed to the same market dynamics as wheat or for that matter, peas, beans, oats, barley rye and milling wheat. Its demand is driven by different sectors; food, fuel, and animal feed, and much of that demand is domestic.
As Nick Grogan, Group Commercial Manager of Pheonix Speciality Oils – owners of the leading cold pressed oilseed rape brand Borderfields – explains: “With uncertainty growing around domestic wheat demand, oilseed rape offers a solid alternative. The UK crush market remains strong, and OSR continues to play an important role in both food and fuel supply chains.”
This makes OSR a useful crop to have in the mix, especially when one of your key cereals is facing an uncertain demand picture. While it might not be the right choice for every field, there’s a case to be made for bringing OSR back into more rotations, not least to help balance the overall risk profile of the farm business.
A Feed Market Shift
There’s another layer to the story that’s worth watching. One of the major by-products of UK ethanol production is DDGS (Dried Distillers Grains) a mid-protein feed used extensively in livestock rations. The two plants combined produce around 750,000 tonnes of this product each year.
If ethanol output falls, that volume will need to be replaced, creating fresh demand for alternative mid-protein feeds.
This is where rapemeal, a by-product of oilseed crushing, comes in. It’s already a well-established feed ingredient in the ruminant sector, and any gap left by DDGS could give it an added boost.
Commenting again Nick explains: “If we see a reduction in UK ethanol production, there’ll likely be a shortfall in DDGS for livestock feed. That creates a clear opportunity for rapemeal, which is already a key mid-protein source for the sector.”
Steady, Not Shiny
To be clear, this isn’t a rallying cry to swing all-out for OSR. The challenges around establishment and pest pressure remain real, and no-one’s pretending it’s an easy crop. But in a more volatile wheat environment, having a profitable break crop that serves a different end market could prove invaluable.
Even modest adjustments in rotation such as reintroducing OSR on the right land, with the right establishment strategy, could offer farms a bit more resilience.
The UK/US trade deal will undoubtedly bring disruption. But it also shines a light on the need for flexible, future-facing crop strategies. OSR won’t be the answer for everyone, but for many, it may once again become part of the solution.