Milling wheat under pressure: where to find value in 2025
3-MINUTE READ
With harvest 2025 now imminent, growers of milling-grade wheat face twin uncertainties over prices and crop quality. It’s not the first time milling premiums have wobbled, but the latest drop has been hard to ignore. Let’s look at what’s driving the trend – and what you can do about it.
Back in June 2023, the premium for milling wheat was riding high. According to AHDB’s weekly crop returns, the average UK ex-farm spot premium for bread wheat over feed wheat stood at £79.50 per tonne, the highest figure on record.
UK milling wheat premiums (spot bread wheat minus spot feed wheat) over the past 10 years
Fast forward to early April 2025, and the milling premium had collapsed to £13.10/t. That’s an 84% drop, and the lowest level since March 2022.
Interestingly, feed wheat prices stayed relatively flat over the same period, from £174.50/t in June 2023 to £171.30/t this April. The premium’s collapse came almost entirely from a steep fall in milling wheat prices, down from £254.00/t to £184.40/t.
Why have milling wheat prices fallen so far?
One key factor is rising imports. According to AHDB’s supply and demand estimates, wheat imports rose from 1.36 million tonnes in 2022/23 to 2.44 million tonnes in 2023/24, and are projected to reach 2.9 million tonnes in 2024/25.
If that projection holds, it would be the highest volume since 2012/13, when extreme weather devastated the UK crop. AHDB also reports that most wheat imports are of milling quality.
Comparing the volumes for wheat production and imports since 2004/05, we see the only other year with similarly low production and high imports is the Covid-impaired 2020/21.
UK wheat production v UK wheat imports 2004/05 to 2024/25
US imports have been helped along by a general upward trend in the GBP/USD exchange rate. Sterling has strengthened against the US dollar, from its all-time low of 1.0356 in September 2022 to a three-year high of 1.3631 earlier this month.
A stronger pound makes overseas wheat cheaper, piling further pressure on domestic milling prices.
It is important to note that the current premium is broadly in line with average levels seen before 2021. The surge from late-2021 to late-2024 broke from recent history. The outlook remains uncertain and there is no guarantee that milling premiums will rise significantly in the near term.
So what can you do?
If you’re growing Group 1 wheat, every penny counts right now, and the regional milling premium might work in your favour.
On Hectare Trading, you can browse recent trades locally and nationwide. We’ve seen examples in just the last week of milling wheat prices showing improved premiums:
West Midlands: £197.00/t offered for Group 1 wheat for July 2025 movement, against July 2025 feed wheat futures at £163.30/t – a premium over the futures price of £33.70/t
Essex & Hertfordshire: offers up to £210.50/t for Group 1 wheat for November 2025 movement, while November 2025 feed wheat futures stood at £184.75/t – a premium over the futures price of £25.75/t
Listing your wheat on Hectare Trading allows you to gauge current market interest. While you’re under no obligation to accept any offer, it can help you understand what buyers are currently willing to pay.
Managing the milling spec risk
One of the biggest headaches with milling wheat is whether it’ll actually make spec at harvest – especially in a year like this, following a dry spring that could affect grain protein levels due to reduced nitrogen uptake.
You might sell your new wheat for post-harvest movement to take advantage of the carry on a forward contract, but then face deductions if the harvested wheat doesn’t meet milling quality.
On Hectare Trading, we see many farmers using “feed base plus premium” contracts to address this challenge.
With these, you agree a feed wheat base price upfront. Then, if your crop meets milling spec at harvest, you receive an agreed premium on top. If it doesn’t, you still get the agreed base price.
This way you can lock in a forward price with peace of mind, managing quality risk without losing market opportunity.
Stay ahead this harvest
Harvest 2025 might be unpredictable, but your grain marketing strategy doesn’t have to be.
While milling premiums are well below their 2023 highs, you can still use regional targeting and flexible forward contracts to get the best possible price for your grain.
Want to check out prices for milling and feed wheat in your region? The Hectare Trading will help you get started with a free account.
This article is for general information only and is not an instruction to trade. While we make every effort to ensure the accuracy of the content at the time of publication, Hectare Trading makes no guarantee regarding the data provided.