Strategie Grains forecast, some, recovery in European Union wheat exports next season, helped by reduced expectations for the former Soviet Union, after drought reduced, particularly, Ukrainian autumn sowings.
Strategie Grains, in its first forecast for EU soft wheat exports in the 2016-17 season, which starts in July, pegged than at 28.9m tonnes
That would represent a rebound of 800,000 tonnes from the estimated shipments for this season, although remain well below the record 33.34m tonnes recorded in 2014-15.
The upgrade came despite a downgrade of more than 500,000 tonnes in the forecast for this year’s soft wheat harvest in the EU, the world’s top grower.
The cut reflected a small reduction, to 23.9m hectares, in the estimate for wheat area, besides an allowance for some damage to crops in Lithuania, Latvia and Poland from recent cold weather.
The EU is now seen producing 143.1m tonnes of wheat this year, a drop of more than 7m tonnes year on year, and the weakest harvest since 2013.
However, the bloc will have substantial stocks of wheat left over at the close of 2015-16, with Strategie Grains foreseeing a rise in carryout inventories to 16.9m tonnes – albeit a figure downgraded by 1.5m tonnes from last month thanks to expectations of increased feed use.
And the EU faces reduced competition next season in wheat exports, thanks in particular to weaker prospects for production in the former Soviet Union, although with farmers too in the US having made deep cuts to winter sowings of the grain.
“EU exports could benefit from a much more balanced world context than in 2015-16, and notably from a lower exportable inventory in the Black Sea countries,” Strategie Grains said.
Ukrainian exports prospects in particular are seen as having been hurt by autumn drought which provoked a sharp drop in sowings of winter crop.
Kiev-based consultancy UkrAgroConsult has pegged at 5.98m hectares Ukraine’s winter wheat sowings ahead of the 2016 harvest, down from 6.8m hectares a year before.
UkrAgroConsult sees Ukrainian wheat production tumbling by 5.6m tonnes to 17.8m tonnes.
Although area lost to winter wheat can still be planted with 2016 crops, it will likely go to the likes of corn or sunflowers, more popular spring sowings options than wheat in Ukraine.
‘Return to balance’
Strategie Grains forecast that the weaker harvest, and uptick in exports, would foster a decline in the bloc’s soft wheat inventories over 2016-17, to 14.2m tonnes.
“Initial prospects for EU soft wheat in 2016-17 point in the direction of a gradual return to balance,” the Paris-based analysis group said.
Inventory levels are closely watched by investors as giving an indication of the extent to which buyers are likely to be forced to pay up to secure supplies.
(Source – http://www.agrimoney.com/news/eu-wheat-exports-to-rise-a-bit-in-2016-17–9209.html)