Market analyst Strategy Grains lowered its estimate for EU soft wheat exports for the sixth time in a row today. The prospects for the next season have also been reversed, as providers from the Black Sea region can continue to offer cheaper.
The experts now estimate the EU soft wheat exports for the 2017/18 season (July / June) at 20.3 million tonnes. This is 900,000 tonnes less than expected in March and significantly less than the 24.2 million tonnes in 2016/17. However, the harvest in the community will be bigger this season.
The low estimate comes mainly because France can export 500,000 tonnes less wheat to countries outside the EU. Eight million tonnes are now expected because Morocco is buying less.
Exports from Germany to third countries are also estimated to be smaller, namely by 300,000 tonnes to 2.9 million tonnes. As well as Poland by 100,000 tons less to now 900,000 tons.
The largest wheat exporter in the EU France suffers primarily from competition from Russia and Ukraine, which is why more wheat was sold to feed mixers within the EU.
For the coming fiscal year 2018/19 the experts estimate that 500.000 tonnes less exported from the EU, because Russia and Ukraine will continue to dominate the market. As a result, French wheat in third countries is expected to exceed 9.2 million tonnes in the coming season and 4.4 million tonnes from Germany.
Overall, exports in 2018/19 will be higher than in the current season, reaching 24.1 million tonnes, mainly because Germany and Poland will be in better competitive situations than Romania and Bulgaria.
Strategy Grains also reduced the estimate for EU barley exports by 200,000 tonnes to 6.75 million tonnes, mainly because France and Germany were able to sell less in Libya and Iran.
The global barley trade will increase, however, as China shows more interest after banning sorghum imports from the US and introducing higher tariffs on US corn.
In the coming season, barley exports from the EU will therefore increase again by 200,000 tonnes to 8.6 million tonnes and belittle the estimate from the previous month.
Despite the expected weaker demand from Iran and Algeria, experts believe that demand from China and Saudi Arabia remains strong and that supplies from Australia and the Black Sea region are not pushing much, as final stocks are expected to be smaller.
On the import side, Strategy Grains expects more corn imports this season of 1.5 million tonnes to a total of 16.8 million tonnes as Brazil, the US and Africa deliver more.
Text: HANSA Derivatives Trading GmbH /
