Strat Grains cuts EU wheat export forecast well below official hopes
Strategie Grains slashed hopes for EU wheat exports, as it downgraded ideas of wheat quality in the bloc.
The Paris-based consultancy cut by 1.0m tonnes its forecast for 2016-17 EU wheat exports, to 23.7m tonnes, which would be down 8.0m tonnes year on year.
The cut to exports was down to lower production, as well as low quality due the poor weather in France, the bloc’s top grower.
EU wheat production was seen at 136.5m tonnes, down 1.4m tones from the previous estimate, at down 10% year on year.
Undershooting other estimates
Strategie Grains’ forecast is well below other analyst estimates.
The International Grain Council has EU wheat exports, excluding durum, at 25.2m tonnes.
And the European Commission forecasts soft wheat exports at 25.0m tonnes.
Quality hopes cut
Strategie Grains slashed estimate of the share of the EU crop suitable for milling to 59%, from 66% seen last month, well below 71% in 2015.
As Strategie Grains president Andree Defois told Agrimoney last week, wet weather and insufficient sunshine badly hurt the French wheat crop this year.
As well as being sharply lower year on year, the French harvest has revealed very low test weights, which means that much of the wheat is below milling quality.
This means that French wheat will struggle to find export markets in North Africa, where the grain is predominantly used for food.
French crop struggle to find market
This shortfall in French quality is hurting French exporter’s prospects in North Africa.
On Wednesday FranceAgriMer, the French farm office, forecast French soft wheat exports outside the EU to fall to 11.91m tonnes, down 43% year on year and the lowest level in over a decade.
FranceAgriMer saw the crop at 28.47m tonnes, thanks to the lowest yields in 33 years.
“France usually accounts for around 25% of total EU wheat production and is the main EU exporter, accounting for nearly a third of the EU’s wheat exports,” said Isobel Robinson, at AHDB.
“With the reduced export potential it is likely that France’s typical destinations could be looking elsewhere for supplies, including the UK,” she said.
In fact, so short is France of quality wheat that imports could be necessary, Ms Robinson said.
“In FranceAgriMer’s final quality estimate it reported the specific weight at 73 kilogrammes per hectolitre.”
“The lowest specific weight that is needed to produce flour is usually 74 kilogrammes per hectolitre, suggesting that French millers will be looking for wheat outside of domestic supplies,” she said.
(Source – http://www.agrimoney.com/news/strat-grains-cuts-eu-wheat-export-forecast-well-below-official-hopes–9937.html)