AHDB’s latest supply and demand estimates show that demand for food and industrial grains in the UK is expected to fall to a 20-year low in 2025/26, pointing to sluggish domestic grain sales this season.
The Taxation Authority’s second official UK grain balance sheet for 2025/26 shows that while demand for animal feed is expected to remain broadly stable, human and industrial (H&I) use is expected to fall sharply, due to pressures in several key end markets.
Compared to estimates published in November, total H&I grain demand was revised downward by 139,000 tonnes to 9.17 million tonnes. This is a decrease of 1.315 million tons compared to 2024/25.
For producers, the numbers highlight reduced demand from domestic processors, which is offset to some extent by tighter overall supply conditions.
Analysts at AHDB say the decline in H&I demand is being driven by three main factors: loss of bioethanol demand, weaker activity in the brewing, malting and distilling (BMD) sector, and weaker consumer demand related to cost of living pressures.
Bioethanol demand has been particularly hard hit. Vivergo ceased operations in August last year after what was described as an “incredibly difficult financial situation” for the industry.
Ensus, the UK’s other major bioethanol plant, has remained shut down since a planned maintenance outage in September.
AHDB envisages that Ensus will remain offline for the remainder of the season unless ongoing discussions with the government regarding support for the sector lead to changes.
Demand in the BMD sector is also said to be very subdued, particularly for barley.
AHDB’s latest estimates put H&I barley usage at 1.584 million tonnes, 84,000 tonnes less than predicted in November and 214,000 tonnes less than last season. This is the lowest level since digital records began in 1990/91.
The further downward revision reflects actual usage data seen so far this season, which AHDB said was significantly lower than previously expected.
Analysts at the collection body say falling consumer spending, changing drinking habits and rising costs are putting pressure on the BMD sector. Global challenges in the sector are limiting export opportunities, with reports of distilleries being idle.
In contrast, total animal feed demand for grains is expected to remain relatively stable, although there will be significant changes between livestock sectors and grain types.
Compound feed demand has been revised downwards since November, mainly due to sharp declines in pig feed and poultry feed production.
Cattle feed demand has remained strong so far, but AHDB expects demand to ease as polling approaches, particularly given the current situation within the dairy herd.
There are more positive signs from the poultry sector, with the integrated poultry sector expected to see stronger growth than previously expected. Demand for animal feed in Northern Ireland is also expected to remain strong.
Regarding grain usage, AHDB said the proportion of wheat and barley in the feed ration is expected to increase this season, while maize usage has been revised downward. A similar pattern has been observed in Northern Ireland, where wheat has so far replaced maize in rationing.
As domestic availability and demand change, trade flows also adjust.
AHDB expects wheat and maize imports to return to more typical levels following last season’s record volumes. Wheat imports are estimated at 2.2 million tons, unchanged from the November estimate but down 28% from the previous year.
The levy body says the higher quality of domestically produced milling wheat has reduced dependence on imported wheat for grains.
Corn imports are now expected to total 2.17 million tonnes, 114,000 tonnes less than expected in November and 30% less than last season. In addition to the loss of bioethanol demand, competitively priced domestic feed grains were the driving force behind the reduction.
This is the first AHDB balance sheet of the season, including wheat and barley exports and ending stock forecasts.
Reflecting the pace of shipments so far, wheat export volume is estimated at 170,000 tons. Barley exports are expected to decline 36% year-on-year to 450,000 tons, and export demand is expected to remain weak.
Despite the decline in domestic demand, the significant decline in total supply means that overall grain balance sheets are tighter than expected.
Overall end-of-life grain stocks are expected to be 3.576 million tonnes, slightly above the long-term average, AHDB said.
Wheat ending stocks are pegged at 2.048 million tonnes, about the same as last season, while barley stocks are expected to be 1.268 million tonnes, also the same as last year.
AHDB said the focus will now be on whether demand for animal feed changes in the second half of the season, whether there is a resurgence in demand for bioethanol, and whether corn becomes more competitive and wheat may be removed from rationing.
So far, analysis suggests relatively average grain stocks are likely to continue in the UK next season, with market direction more sensitive to changes in feed demand and trade flows than to recovery in human or industrial utilization.
