Poor harvests, high wheat prices, the biofuel revolution and the booming Chinese and Indian economies are all squeezing supply of grass seed. And that can only mean one thing - grass seed prices are going up.
The problem, says seed breeder Barenbrug UK's managing director Paul Johnson, is that these developments have meant it has become even more difficult to find farmers willing to grow grass seed, let alone increase their acreage.
The good news, though, for greenkeepers and groundsmen is that they will only be paying more or less what they were 10 years ago. Seed breeder Top Green marketing manager Stephen Alderton explains: "Amazingly, grass seed, bag for bag, costs less than it did 20 years ago, so it is in many ways a realignment of the marketplace. But to be fair to customers we are spreading the cost over the next 12 months."
The wheat market
Although cereals and grass seed are traded and used in very different ways, one has a significant impact on the other.
Poor weather last summer in northern and western Europe reduced wheat crop tonnage dramatically, while Australia suffered from serious drought resulting in a harvest that was down by 50 per cent on an average year.
According to East Anglian wheat farmer Hugh Wiseman: "All of a sudden the balance was tipped in favour of consumption, and once commodity traders realised wheat was in short supply, the price doubled from September to the end of October 2007.
"Now people are realising that even if the world produced a record crop this year we are still going to be short of wheat as there is a backlog in demand to make up. This means for the next two years prices will remain high and could reach a peak if below-average harvests occur again.
"So farmers on good land who are currently growing grass seed will see that they can reduce their risk by changing to wheat. Grass prices will need to keep pace, otherwise farmers will revert."
And this is already happening, with grass seed prices increasing in January with further rises likely in this summer and next spring. As EU grass-seed consumption currently outstrips production, stocks are predicted to fall by nearly 50 per cent over the next two years.
Alderton says: "Turf growers could put their land to cereals, so they too need to be encouraged to retain their grass-growing into 2009. With Top Green's production in Denmark this is not perhaps quite such a critical issue, as it is easier to convince Danish farmers of the merits of turf production due to their rotational methods. It's harder in the UK and France."
Denmark is Europe's largest grass-seed grower and home of the world's largest grass-seed firm, DLF Trifolium. UK amenity sales manager Derek Smith says: "It is easy for farmers to go back into cereals, and we are seeing this to some extent in Denmark.
"But there is a reason for them to stay in grass seed as they have all the equipment, storage and cleaning plants necessary. However, yield and price will need to increase."
The energy market
The cost of growing, harvesting and transporting seed is rising as a result of higher fossil-fuel prices, which are also fuelling inflation in agricultural commodities as crops such as maize, sugar cane and rapeseed are increasingly being grown for biofuel.
Besides cost and environmental motives, many countries are seeking to reduce dependence on supplies from the Middle East and Russia for political reasons.
US-grown maize has been diverted around the world to keep the cost of wheat down over the past 10 years. Now, with 2007 seeing approximately 20 per cent of the maize production in the US used for bio-energy, this no longer happens.
Countries like the US and Brazil have created a hefty bioethanol industry, and this is likely to expand further. China and Canada also plan to increase biofuel production.
In the EU, consumption of bioenergy is predicted to increase by 170 per cent in the period 2006-2010, and with the EU committed to producing more energy from alternative sources, this rapid growth is expected to continue. Recent high cereal prices have dampened an expansion of the bioenergy industry, with Europe and the US seeing investment projects being halted and production sites closed down. But any future drop in cereal prices is likely to be counteracted by increased demand from the bioenergy sector, preventing prices from going back to their previous low level.
Central and eastern Europe as well as Asia are booming economies and this is having an impact on keeping wheat prices high.
As poorer nations become wealthier, their food tastes are changing. An increasing appetite for meat and dairy products in countries such as China has led to more animals being bred. To feed these requires more cereal than these countries currently produce. In addition, they are also importing substantial amounts of fertilisers and sprays, pushing the prices of these commodities up throughout the world.
As with wheat, last year's grass-seed harvest was also down - by 25 per cent in Denmark and Holland, and by 40 per cent in other areas. As a result, it may be difficult to get grass seed in sufficient quantities.
According to Johnson: "Currently our UK production totals some 2,000ha and the harvest in 2007 was not an easy one. There were quality problems due to the bad weather and some crops have now failed germination tests. In addition, other crops have been very dirty, resulting in increased cleaning costs and a drop in yield.
"This difficult harvest, which was replicated across Europe, coupled with the rise in production costs means that all grass seed for the amenity sector will see a price increase this year and possibly next."
And it is not just a question of price rises - there are shortages too. Johnson adds: "We've already experienced a shortage of bents throughout the industry. And this can only get worse as we go further into this year's peak selling season."
Specialist seed agent Rigby Taylor's grass seed development manager Stephen Denton says: "We are trying to feather the increases into the marketplace but are fully aware that, as the new harvest comes in, price increases are unavoidable. Our aim is to do all we can to ensure our customers have continuity of supply going into 2009."
Alderton believes that these factors will make good-quality seed relatively more attractive. He says: "Cheap seed goes up in price more than the quality seed but does not yield as well.
"But for environmental reasons it is vital to encourage farmers to grow grass seed and turf growers to produce turf, and to be prepared to pay them accordingly."
The same factors that affect seed production also affect turf growers - many of whom went into turf production in the first place to diversify because of low crop prices.
Yorkshire-based turf grower Inturf has a total of 550ha of cultivated turfgrass, with 200ha being sold annually. Managing director Alex Edwards says: "Recent rises in the cost of fuel are having a serious effect on distribution costs and the operation of farm equipment.
"Added to this, we see increased costs across the board, especially in the price of grass seed and fertilisers, so the cost of growing turf has risen. As a result, our prices have gone up.
"We have already lifted them by five per cent and expect this to rise further, although we will have to continue to absorb as much as possible of the increases inflicted on us. That said, sales are running at record levels as turf is an extremely popular product with professionals for sports and landscape applications."
RUNNING ON BIOFUEL
While the growth of biofuels serves to raise seed prices, it also provides opportunities for the grounds care industry. Manufacturers of professional mowing equipment are looking at producing machines that can run wholly or partly on biofuels.
Etesia UK general manager, Les Malin, says: "In caring for the environment our continuing challenge is to keep looking at alternative sources of eco-friendly fuel."
Enormous funds are being spent at Etesia's research and development laboratory in Wissembourg, France. Malin adds: "We are an industry leader in the field of biofuels with the proven technology to run our latest mowers on pure vegetable oil."
David Roberts of Kubota says: "The marketplace will push biofuel even further and our mower, which currently runs on up to 20 per cent biofuel, will no doubt increase once they have sorted out quality control on the fuel-manufacturing side."