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EU lifts expectations for corn, rapeseed imports, as harvest hopes fade

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The European Union raised its forecasts for corn and rapeseed imports, as it cut harvest estimates - but stood by expectations for wheat exports, despite improved production ideas.

 

The European Commission raised by 500,000 tonnes to 5.50m tonnes its forecast for EU rapeseed imports in 2019-20, a figure which would represent a record high, and a gain of 1.27m tonnes year on year.

 

The revision came as the estimate for the harvest was cut by 544,000 tonnes to a 13-year low of 16.93m tonnes, on a downgraded area estimate, which the commission said “is now 19% below last year”.

 

The commission flagged in particular “further monthly reductions for rapeseed output in Germany and Romania”.

 

EU rapeseed imports for 2019-20, up to Sunday, totalled 1.75m tonnes, up 86% year on year.

 

‘Not soon enough’

For maize, the commission raised its forecast for EU imports in 2019-20 by 1.52m tonnes to 17.00m tonnes, although this would still represent a large fall from the 24.23m tonnes imported last season.

 

Again, the revision reflected a production downgrade, with the estimate for EU corn output this year cut by 2.04m tonnes to 66.46m tonnes, taking it further below 2018’s result of 68.98m tonnes.

 

The revision follows persistent cautions that dry weather has reduced EU corn production prospects, with the commission’s Mars agrimeteorology unit last week cutting its yield estimate by 0.30 tonnes per hectare to 7.63 tonnes per hectare, citing heat and dryness which had cut prospects for crops in the likes of Hungary and Romania.

 

CRM AgriCommodities said that while “rains have finally arrived for western Europe”, in time to help plantings of winter cereals for the 2020 harvest, they were “not soon enough for maize”.

 

Buoyant imports

EU corn imports too have started apace, standing at 4.80m tonnes in 2019-20 as of Sunday – running 54% ahead of the pace at this stage of last season, which ended up setting the record.

 

Brazil is the leading origin so far this season, on 2.71m tonnes, with Ukraine second on 1.54m tonnes.

 

Buyers are being encouraged by increasingly competitive prices of corn compared with other grains, with corn in Rouen, France, for instance, priced at E160 a tonne, compared with E165 a tonne for soft wheat and at a premium of E6 a tonne over feed barley, according to Agritel.

 

Corn started the month at even money with wheat, while at an E11-a-tonne premium over barley.

 

Wheat expectations

For soft wheat, the commission raised its forecast for EU production this year by 2.35m tonnes to a four-year high of 145.0m tonnes, the latest in a series of upgrades by market commentators, largely thanks to better-than-expected results in France.

 

The commission’s revision reflected increases both to area and yield.

 

However, the forecast for EU soft wheat exports this season was kept at 25.53m tonnes despite the extra supplies, which were instead seen boosting the bloc’s stocks at the close of 2019-20 to 16.90m tonnes.

 

EU soft wheat exports had reached 5.45m tonnes this season up to Sunday, a gain of 36% on last season, when shipments ended up at 20.63m tonnes.

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