European Union wheat exports will not recover as strongly in
2017-18 as some commentators imagine, despite better harvest prospects although
shipments this season will beat expectations, US officials said.
A report from US Department of Agriculture bureaux -
offering the first glimpse of what the world's most important agricultural
commodity forecaster is thinking on next season's EU grains balance sheet from
pegged the bloc's overall wheat exports at 29.0m tonnes.
That would remain well below the levels, as high as 35.4m
tonnes in 2014-15, which drove the EU to top rank among world wheat exporters
before last year's disastrous French harvest, hurt by summer rains, dented
supplies in the bloc's top producing country.
The forecast is also below the 30.4m-tonne figure that the
European Commission sees the EU achieving in wheat exports next season, which
starts in July.
The International Grains Council forecasts EU wheat exports
recovering in 2017-18 to 30.0m tonnes.
'Lower carry-in stocks'
The USDA bureaux's estimate for EU wheat output in the
forthcoming harvest, at 151.7m tonnes including durum, was in fact a touch
higher than the IGC and European Commission forecasts, although below a 153.2m-tonne
estimate from industry group Coceral.
However, the bureaux was more downbeat on supplies carried over
from this season a reflection in part of ideas that EU exports will not fall
as far as other commentators believe.
Forecasts for EU all-wheat exports in 2017-18, and (2016-17)
European Commission: 30.41m tonnes, (25.476m tonnes)
IGC: 30.0m tonnes, (25.2m tonnes)
USDA bureaux: 29.0m tonnes, (27.0m tonnes)
The bureau in their report flagged a "considerable
tightening" in EU stocks this season, a fact which would be felt "heavily on
the 2017-18 balance, even with production forecast at 151.7m tonnes".
France vs rest of EU
While acknowledging that the EU will in 2016-17 wheat
exports "lose some share" of trade to the key North African and Middle Eastern
markets, the bureaux said that French volumes would remain strong enough for it
to remain the bloc's top shipper.
And "exports are forecast up in Germany, Romania and
Bulgaria and, to a lesser extent, Poland and Italy," the bureaux's report said.
"Germany reports a notable increase in exports to Algeria,
Saudi Arabia and Turkey."
Romanian exports, meanwhile, had been buoyed by "an
excellent wheat crop" last year, while demand for Bulgarian and Polish wheat
has been helped by a harvest last year high in quality and quantity.
The bureaux forecast EU wheats exports in 2016-17 at 27.0m
tonnes a drop of 7.7m tonnes year on year, but well above the USDA's official
estimate of 25.5m tonnes.
Forecasts for EU all-wheat production, 2017-18
Coceral: 153.232m tonnes
Strategie Grains: 152.8m tonnes
USDA bureaux: 151.7m tonnes
European Commission: 151.129m tonnes
IGC: 150.3m tonnes
"Overall, EU wheat exports are currently forecast to
decline nearly 8m tonnes on a year earlier, but not as much of a reduction as
The estimate is also well above figures from other
commentators, including Strategie Grains, which foresees a sub-25m-tonne result.
On their estimate for EU wheat production of 151.7m tonnes,
the bureaux said that the figure reflected ideas of a harvested area of 26.3m
That would be down 700,000 hectares year on year, and below
the 26.8m hectares recorded in 2015, when the EU produced a record wheat
harvest of 160.5m tonnes.
Conditions had been largely benign, although low winter
temperatures had caused some crop damage in the Czech Republic and Hungary, and
likely in the Baltic states too.
"In summary, the sentiment is generally good but with the EU
entering a critical yield and quality determining weather period, producers are
cautious to assume a positive outlook given the French experience in 2016-17."