France raised its forecast for its soft wheat exports in 2019-20, despite official data showing a weak start to the season, but amid expectations of an acceleration in volumes, fostered by North African demand.
FranceAgriMer, the official French crop bureau, raised by 700,000 tonnes to a four-year high of 11.70m tonnes its forecast for the country’s soft wheat shipments outside the European Union this season.
The upgrade - which took the estimate 21% above the 9.67m tonnes achieved last season – came despite data showing a poor start to 2019-20 for French exports outside the EU.
French customs data for July and August, the first two months of 2019-20, show shipments outside the bloc falling by 10.8% year on year to 1.52m tonnes.
Signally, exports to the key Algerian market, at 944,777 tonnes for the two months, were 23% down year on year, after the North African country, which has declared an aim of cutting its reliance on imports, achieved a strong domestic harvest.
Indeed, “the beginning of the wheat export campaign in France is rather disappointing so far”, said Agritel, with shipments to other EU countries, at 1.30m tonnes for the two months, also showing only modest growth year on year, of 3.5%.
However, “business should pick up on the September-October period”, with France having achieved some high profile victories in export tenders, such as the 180,000 tonnes sold to Egypt’s Gasc grain authority over the past two months.
Marion Duval, deputy head of FranceAgriMer’s grain unit, said that the bureau’s forecast was in fact "seen as being at the low end of market expectations.
"Our view is rather conservative compared to some exporters."
More to Morocco?
Hopes have also grown of more sales to Morocco, whose own wheat production this year halved to 2.68m tonnes.
A meeting on Tuesday of France Export Céréales, which promotes French grains exports, “confirmed that Morocco should buy 3.8m tonnes of wheat during this marketing year” following its “poor harvest”.
Last season, Morocco purchased 2.6m tonnes, of which France provided 1.4m tonnes.
“France remains a special partner on this destination,” Agritel said.
While FranceAgriMer left at 8.36m tonnes its forecast for French soft wheat exports inside the EU this season - a rise of nearly 1.0m tonnes year on year - the upgrade to the estimate for overall shipments more than offset increased supply ideas.
The bureau factored in a French 2019 harvest estimate which France’s agriculture ministry raised on Tuesday by 300,000 tonnes to 39.75m tonnes.
The revisions played out in a downgrade of some 260,000 tonnes to 2.90m tonnes in the forecast for French soft wheat stocks at the close of 2019-20, although this still represented a rise of 430,000 tonnes year on year.