EU: European Commission downgrades wheat and barley production forecasts

The European Union wheat crop suffered its second downgrade in two days as the European Commission reduced its forecast below 140 mln tonnes, following a cut by the International Grains Council too, Agrimoney.com reported on June 30.

The forecast for this year's EU barley harvest suffered a bigger downgrade, with the commission ditching expectations of production staying in line with last year's.

The commission cut its estimate for the EU soft wheat crop, the world's biggest, by 2.42 mln tonnes to 138.86 mln tonnes.

While still higher than the 134.36 mln tonnes produced last year, when summer rains wrought heavy damage to France's crop, the commission's revised forecast was lower than that from many other commentators.

Indeed, the International Grains Council late on June 29 cut its forecast for the EU soft wheat harvest by 400,000 tonnes to 140.8 mln tonnes.

Earlier this month, market analyst Strategie Grains cut its EU wheat estimate by 1.1 mln tonnes to 141.6 mln tonnes, in line with a loss of yield potential in France, Germany and Spain.

Strategie Grains has since downgraded the French wheat crop by a further 1.6 mln tonnes to 35.6 mln tonnes, after the spell of hot dry weather in the third week of June.

The commission's downgrade reflected a cut of 0.1 tonnes per hectare to 5.8 tonnes per hectare in the forecast EU soft wheat yield.

The International Grains Council also lowered its yield expectations, saying that while late-May rains had "helped to stabilise" prospects for French, German and UK crops, "concerns about limited soil moisture in parts of western Europe returned following hotter-than-normal temperatures" in June.

"Mostly dry conditions also persisted in northern Spain and Italy."

However, prospects in the main central and eastern producing countries, including Poland, are "broadly satisfactory".

The commission downgraded its forecast for this year's EU barley harvest by 2.47 mln tonnes to 57.0 mln tonnes, taking the estimate further below the 2016 figure of 59.6 mln tonnes.

The revision also reflected a cut of 0.1 tonnes per hectare in the yield forecast, to 4.7 tonnes per hectare.

The IGC in its monthly report made a smaller downgrade to its EU barley crop forecast, of 1.2 mln tonnes to 58.8 mln tonnes.

The council cited damage to the crop from "spells of adverse weather", and noted "disappointing results" to Spain's harvest, "due to drought".

"Combining started early in France, but because of dryness and earlier frosts, yields are seen slightly lower than average."

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