Strategie Grains sees EU wheat crop rebound to four-year high

14.12.2018

European Union grain crops will jump in 2019 with soft wheat, the main crop cultivated in the bloc, hitting a four-year high due mainly to a sharp rise in projected yields after a severe drought this year, Strategie Grains said on Thursday.

In its first estimate for next year's crop, the consultancy estimated the EU soft wheat harvest at 147 million tonnes, up 16 percent from a poor 127 million tonnes in 2018. The area sown was seen rising 6 percent while yields would gain 9 percent.

The 2019 harvest in the EU member states would be the largest since 2015 when the EU soft wheat crop totalled 152 million tonnes, Strategie Grains said.

Strategie Grains' estimates are based on a European Union with 28 member states and do not yet take account yet of Great Britain's planned exit from the bloc in March 2019.

Drought and heatwaves since late spring have hurt this year's crops in the central and northern part of the bloc, notably in Germany, the second-largest EU producer.

For barley, Strategie Grains sees the 2019 crop rising 10 percent from this year to 61.5 million tonnes with the increase only linked to a rebound in yields.

The 2019 maize crop would reach 62.9 million tonnes, up 4 percent from this year while rye would jump 29 percent to 8.2 million tonnes. Durum would be the only cereal to see volumes fall next year, with an expected drop of 5 percent to 8.1 million tonnes.

Overall Strategie Grains sees EU grain crops surge 11 percent in 2019 to 311 million tonnes, up from 279 million a year earlier.

These high crop forecasts contrast with an expected fall in the rapeseed harvest next season after sowing was hurt by dry autumn weather in the EU's top producers Germany, France and Britain.

For the current 2018/2019 season, the consultancy made few changes in its crop estimates but cut its monthly EU soft wheat export forecast by 500,000 tonnes to 19 million tonnes, down from the 20.5 million exported in 2017/18.

"EU wheat remains strikingly uncompetitive even though Russian prices are beginning to shudder," Strategie Grains said.

"Nevertheless, our forecast for EU wheat exports is high compared with the volumes shipped during the early part of the campaign from Germany and Poland because we think that the pace of EU exports will accelerate once Black Sea availabilities start to disappear."

Strategie Grains also cut its forecast for EU 2018/19 barley exports by 700,000 tonnes to 5.4 million tonnes, now below the 5.9 million shipped last season.


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