Strategie Grains extended a round of upgrades to hopes for European Union soft wheat exports, as it raised its forecast for the bloc’s production, and following a rapid early-season pace of shipments.
The analysis group hiked by 900,000 tonnes to 25.7m tonnes its forecast for EU soft wheat shipments in 2019-20, as started in July.
That represents a sharp increase on the 21.40m tonnes shipped last season, on European Commission estimates, and follows upgrades by other observers too to EU export projections.
The commission late last month made a small upgrade, to 25.53m tonnes, in its forecast for the bloc’s soft wheat shipments in 2019-20, while the US Department of Agriculture last week hiked by 1.0m tonnes to 27.50m tonnes its estimate for the EU’s all-wheat exports, including durum.
Strategie Grains cited an increase of 1.6m tonnes to 144.5m tonnes in its estimate of the EU’s soft wheat harvest this year – the best result since the record 151.9m-tonne crop reaped four years ago.
The Paris-based group backed expectations of strong harvests in France, where output this year was the second highest ever, and the UK.
However, it also cited a brisk pace of shipments, particularly from Romania - where exports have reached 1.72m tonnes so far this season, up from 1.30m tonnes at the same period of last season – and Bulgaria, where they have soared to 484,729 tonnes, from less than 39,000 tonnes a year ago.
The EU’s overall soft wheat exports so far in 2019-20 are, at 5.12m tonnes, running 34% ahead of the pace as of the same period of last season.
The thinking echoes that of the US Department of Agriculture last week, which also raised its forecast for the EU’s harvest, by 1.0m tonnes to 151.0m tonnes including durum, while stressing a “fast early-season shipment pace” supported by “competitive prices”.
On its assessment, EU wheat export prices, as measured in the French port of Rouen, ended last month at $184 per tonne excluding freight, $4 per tonne cheaper than Black Sea values.
Month on month, “EU prices declined $8 per tonne on the advancing harvests in major wheat-producing countries, particularly France,” the USDA said.
“Black Sea wheat declined only $7 per tonne as dry conditions in Russia have reduced yields.”
Russian wheat exports have begun 2019-20 at a slower pace, reaching 7.75m tonnes in the first two months, according to SovEcon, which forecasts shipments this month at 3.40m tonnes, a drop of 25% year on year.
SovEcon has forecast Russian shipments in 2019-20 overall at 31.6m tonnes, a drop of 12% year on year.