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# Yield and price: how a UK harvest shock reaches the market

CropIntel forecasts UK wheat *yield*. Price is what you ultimately
trade. This page sets out, honestly, how the two connect over the years
we have ex-farm price data for, and, just as importantly, where the link
is weak and why.

The short version

A smaller UK harvest tends to firm domestic ex-farm price; a big harvest
tends to soften it. That direction holds in the data. But the relationship
is **loose**: the UK is a price-taker, and global supply,
demand, and currency move flat price far more than the British harvest does.
The durable value of a UK yield edge shows up in **basis, regional
premium, and the timing of risk**, not in calling flat price.

## The economic logic

Wheat is fungible and traded globally. A poor UK harvest tightens the
domestic balance sheet, less home-grown grain, more import pull, firmer
regional premiums over the futures benchmark. So the *sign* of the
relationship is exactly what theory predicts: lower yield, firmer price.
What theory also predicts, and the numbers confirm, is that the
*magnitude* is small relative to the global drivers stacked on top.

## Year by year

Our national directional lean, the actual UK yield anomaly (versus trend),
and how ex-farm feed wheat moved across that harvest's marketing year
(post-harvest autumn → the following summer). Price data begins in 2015.
The lean is shown only where it was strong enough to stand behind; the
confidence-filtered, region-by-region accuracy that gives the 62.3% headline
is on the [track record](/track-record).

| Marketing year | Our yield lean | UK yield anomaly | Ex-farm price move |
|---|---|---|---|
| 2015/16 | Near avg | +0.11 | +9.2% |
| 2016/17 | Near avg | +0.88 | +10.5% |
| 2017/18 | Near avg | +0.05 | +22.7% |
| 2018/19 | Near avg | +2.04 | -20.2% |
| 2019/20 | Below avg | -1.66 | +23.4% |
| 2020/21 | Near avg | -0.05 | +6.4% |
| 2022/23 | Near avg | +0.48 | -30.9% |
| 2023/24 | Below avg | -1.03 | -3.4% |
| 2024/25 | Near avg | -1.41 | -10.0% |

## How tight is the link? Honestly: loose.

Across the 9 marketing years with price data, the correlation between the
UK yield anomaly and the ex-farm price move over the year is
**r = -0.38** (p = 0.32, n = 9). The negative sign is
the right direction, lower yield, firmer price, but it is weak and not
statistically significant on this sample. Yield explains only a small share
of the year-to-year price swing.

**The clearest example of the limit: 2022/23.** The UK harvest came in +0.48 versus trend (slightly *above* normal, which all else equal should soften price), yet ex-farm feed wheat moved **-30.9%** across that marketing year. That swing was the global market unwinding the 2022 invasion-spike, nothing to do with the size of the British harvest. When the world moves, UK yield is a rounding error on flat price.

Why we don't sell this as a price forecast

Claiming we predict UK wheat *price* from yield would be
overreaching, the data doesn't support it, and a buyer who re-ran the
numbers would rightly discount everything else. We forecast the UK
**supply shock** (yield), and we're transparent that flat price
is a global variable. That honesty is the point.

## Where a UK yield edge actually pays

Knowing the UK harvest before the trade reports do is valuable, just not
as a flat-price punt:

- Basis & regional premium, a short domestic crop
widens UK premiums over the futures benchmark; an early read on that is
edge for a grain merchant.
- Reserving & claim timing, a below-average UK
harvest is a leading indicator for a
crop insurer's parametric and shortfall
exposure.
- Directional overlay & risk timing, a UK
supply-side surprise is one input a
commodity desk can fold into a wider
book, well ahead of official estimates.

## Our skill is at the yield step

This page is about the *downstream* link from yield to price, which
is loose. The thing CropIntel is actually good at is the step before it,
calling the UK yield itself, with a walk-forward hit rate of
**62.3%** over 23 years. That record, region by region and year
by year, is on the [track record](/track-record).

Related: [Today's call](/today) ·
[Track record](/track-record) ·
[By the numbers](/statistics) ·
[Methodology](/methodology).
Not financial advice, see the footer.