Drought and heatwave damages EU wheat, export surplus to be cut

Europe is grappling with one of the hottest summers on record. Weather-hit cereal harvests in Europe will lead to tight wheat supplies in 2018/19. Wheat exporters like Germany and Scandinavia may need imports, experts said. 

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Drought and a heatwave that scorched fields in northern Europe may cut the European Union’s wheat export surplus and the bloc will need to consume more of its own grains, experts said. French analysts Strategie Grains forecast a 10 percent smaller EU soft wheat harvest this year, with northern areas particularly hard hit. EU wheat prices have hit over five-year highs on crop concerns.
“Wheat exporters like Germany and Scandinavia may need imports from the rest of the EU this year, especially for animal feed wheat,” one German trader told Reuters. “The terrible harvest in north Europe is good news for rival wheat exporters like Russia, Ukraine and the United States.”
Some wheat from EU Black Sea exporters such as Romania is likely to stay in Europe rather than being shipped to the Middle East, the trader said.

GERMANY’S GRAINS CROP LOWEST IN 24 YEARS
In Germany, the EU’s second-largest producer, the winter wheat crop is expected to fall 19.9 percent on the year to 19.2 million tonnes after the highest July temperatures since records began in 1881. Germany’s 2018 grain harvest will be the lowest in 24 years after a drought and heatwave heavily damaged crops, farm cooperatives have estimated.“Germany is usually one of the EU’s biggest wheat exporters but will swing to an importer this season especially for animal feed,” another German trader said. “About 800,000 tonnes of feed wheat have already been bought, mostly from Romania and Bulgaria, and I think more could be bought.”
In France, the EU’s largest producer, harvesting is over. Torrential rain and heatwaves are expected to have cut the crop, although damage was seen as less severe than in northern Europe. Crop estimates are generally between 33 and 35 million tonnes, down from 36.6 million last year, while milling quality was generally good. Quality results showed decent protein content, averaging above 11.5 percent, and test weights generally above milling requirements despite some mixed readings linked to heavy rain, agency FranceAgriMer said.
Denmark’s harvest of wheat, barley and rye could fall by about 40 percent from previous years. Poland’s crop will fall about 12 percent to roughly 9.9 million tonnes, Wojtek Sabaranski of analysts Sparks Polska said. Harvesting is well advanced but crop quality varies greatly, Sabaranski said. Trade estimates for the UK wheat harvest range between 13.5 million and 14.0 million tonnes, down from 14.8 million last season. the European Commission recently said it would speed up payments to EU farmers hit by extreme droughts to counteract the decrease in crop production.

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