Date: 09.01.2023

A tough economic situation coupled with increased costs for energy, wages, fertilisers, packaging and logistics have pushed up prices for forage and turf seed. In addition, favourable prices on agricultural goods, such as wheat, sunflower and oil seed rape have made these crops more attractive to growers and put on pressure to grass production to get a competitive seed production contracted. Seed growers consider whether they should reduce grass seed production and instead cultivate the more favourable agricultural crops.

Grass seed growers had a good harvest of the crop 2022 in the main European growing regions with slight differences due to different conditions and weather impacts in the distinct growing regions.

It is still far too early to make statements of the estimated total European seed supply, due to the up and downs of the incoming reports. Different levels of drought damage and other impacts across Europe, which in some cases are local rather than a regional, are giving difficulties to gather the complete European picture.

Other market influences are imports, but for various reasons it seems unlikely that European imports from other continents will increase. Factors such as currency rate, container freight prices, production costs and low yields are the main barriers to trade.

Since agricultural commodity prices are competing with grass and clover seed production, it is becoming more challenging to maintain the balance between farmer production prices and an adjusted acreage that will cover future demand.

Climate change and the resulting challenges farmers have to cope with does not help make future demands more predictable. Summer drought caused severe damage to many agricultural crops across Europe, as well as to the turf grass production areas.

In the short term, we expect normal to good spring consumption 2023 for forage and turf, which will reduce stock at all levels of the supply chain. Contracting new production for the 2024 harvest remains difficult. We expect to see a drop in European grass production acreage for the harvest years 2023 and 2024 caused by very high grower prices to compete with the alternative of favourable crops. That consequently means that we see steady or further increasing prices for the future.