EU wheat prospects improve

French wheat yields are not as bad as feared, with rainfall in June proving beneficial, and leading the French Farm Ministry to increase its crop forecast to 32m tonnes.

Strategie Grains has increased its estimate for EU-27 grain production for 2011/12 by 6.6m tonnes, to 282.3m tonnes.
And soft wheat production, due to excellent conditions, is now projected at 130.2m tonnes, 4.6m tonnes higher than previously thought and 2.9m tonnes higher than last year.

Specific weights were higher than normal in northern France, and protein contents were at 12-13%, said David Sheppard, managing director at Gleadell Agriculture.

“Wheat prospects in the EU have improved over the past weeks with production forecasts for the major producers now showing signs of increasing.

“With the apparent cheap offers of Russian wheat, this extra EU tonnage should keep markets in check during the short-term as harvest progresses in the northern hemisphere regions.”

Ukraine faced more grain-damaging downpours, which may cause crop losses of up to 30%, he added.

But SovEcon expected the Russian grain harvest to rise to 87-92m tonnes due to improved weather conditions.

“Wheat production is estimated at 55-58m tonnes, and that should support competitive and aggressive exports.”

Elsewhere, the Australian wheat crop could face a dry spring, and a third of the New South West crop had reportedly been lost to the worst plague of mice ever seen.

“Long-term, the sentiment regarding Australian and Argentine production is not as bearish as first thought.

“Dry weather in Australia and lower planting estimates in Argentina are potentially lowering earlier record production forecasts, which may add support as the new season progresses.”


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