UK farmers may have the last laugh after seeing some of
their trade in feed wheat taken by France - with growing expectation that British
growers may take some higher-value milling wheat export business from their
Merchants in France have opened the 2014-15 crop year with a
flurry, unusually, of export offers of feed wheat - competitively priced
against a background of a European Union wheat harvest which looks like coming
in big on quantity but disappointing on quality, thanks to harvest-time rains.
French wheat was last week sold to Ireland at some E10 a tonne
below offers from the neighbouring UK.
Ireland typically takes some 170,000-200,000 tonnes a year
of UK wheat, and imported 334,000 tonnes in 2008-09.
The French crop, the EU's biggest, has suffered particularly
badly from harvest time rains, prompting talk of huge amounts of grain being
fit only for feed.
"With about 30% of the national crop still to cut, only
about 50% of the wheat harvested has a Hagberg falling number over 180,"
traders at a major European commodities house said.
Even domestic French millers typically require a Hagberg number,
in essence a measure of sprouting, above 180 seconds, with some of the country's
major export customers being even more picky.
Egypt requires a Hagberg of 200 seconds, and Algeria is
reported by Synacomex as requiring 240 seconds, with a Glencore source putting
the figure at 225 seconds.
However, with the UK crop – so far – coming in with unusually
strong quality, thanks to a prolong period of dry weather, that could open up the
North African market which is usually the domain of French supplies.
"Usually we would not have a chance of getting into Algeria.
France has an advantage on shipping, and its wheat is of better quality," a UK
grain trader told Agrimoney.com.
"But with the quality of what we are producing, and the trouble
they are having in France, we could see UK exports going quickly to places such
as Algeria, replacing French wheat."
While many North African and Middle Eastern supplies will
likely prefer competitively priced former Soviet Union supplies, Algeria, for
insect damage reasons, tends to buy from Europe, and in particular France, with
which it has historical ties.
Algeria imports at least 6.0m tonnes of wheat a year, making it typically the fourth-ranked buyer, after Egypt, Indonesia and Brazil.
1976 or 1984?
As for the UK crop, "it is reminiscent of what we saw in 1984
– a big harvest, big on quality, which was all harvested by August 20," an
early finish, the trader said.
Wheat merchant Frontier, saying the UK harvest had begun at
its earliest since the drought year of 1976, said that "so far good yields and
quality have been reported".
The European commodities house said that traders were now
looking at a UK wheat crop above 16m tonnes, up from 11.9m tonnes last year,
and offering a "healthy exportable surplus", with the country typically
consuming about 14m tonnes of wheat a year itself.
On quality Agrimoney.com has heard talk of strong bushel
weights, of 80 kilogrammes or more per hectolitre, and Hagberg numbers of 300
seconds and above.
The European commodities house said: "From what we have seen
so far, UK wheat quality is good - specific weights well above the 72 kilogrammes
per hectolitre minimum, strong Hagbergs but some variable proteins in the
"This may allow some UK wheat to reach an acceptable
specification for North African markets."
The limiting factor for entering markets such as Algeria would
appear to be the protein level which, thanks largely to wheat varieties grown,
is below the levels needed to replace French supplies.
"But that should not be such a problem. You can blend that
up mix it with hard wheat from Canada or Germany– that's what millers do," the UK grain trader said.