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Showers To Help EU Wheat Crops But Analysts Wary Of Repeat Drought

Published on Apr 28 2019 2:30 PM in Supply Chain tagged: Spain / Poland / Germany / Drought / EU Wheat

Showers To Help EU Wheat Crops But Analysts Wary Of Repeat Drought

Showers have brought some relief to thirsty wheat crops in the European Union, but more rain will be needed in the coming weeks to avert a second successive year of drought damage, analysts said.

An increase in wheat sowings by farmers followed by a mild winter has put the EU on course for a rebound from last year's drought-hit harvest.

The European Commission on Friday lifted its forecast of EU common wheat production in 2019/20 to 141.3 million tonnes, up 10% from last year, from 140.2 million last month.

Rainfall in southern EU countries like Romania and Spain this month should stop further loss of yield potential after a long dry spell, Benoit Fayaud, crop analyst with Strategie Grains, said.

Showers moving further north across Europe from this week may also ease dryness for now, he said.

'Halfway House Situation'

"We're in a halfway house situation in much of Europe," Fayaud said. "There's some rain returning but it won't be enough if the weather is dry in May."

In France, farm office FranceAgriMer cut its rating of soft wheat crops to 79% good/excellent for the week ending 22 April, down from 81% the prior week and extending a decline this month.

An unsettled spell this week has brought showers and more rain is forecast next week, encouraging Paris wheat futures to slide on more favourable crop prospects in much of the northern hemisphere.

Weather concerns were more marked in Germany, where recent dryness has focused attention on low moisture reserves following severe drought last year.

"Overall the picture is looking good but dryness is appearing as a worry again, especially in the north and parts of the east," one German grains analyst said.

"The problem is that sub-soil water levels are still low after last year's drought and need to be replenished."

Germany's association of farm cooperatives (DRV) has forecast the wheat harvest will increase 20.6% on the year to 24.44 million tonnes.

Growing Concern

In Poland, there was also growing concern about dryness, particularly if rain remains scarce in May, said Wojtek Sabaranski of analysts Sparks Polska.

"Due to the adverse weather, we have been forced to cut our previous optimistic 2019 all-wheat crop forecast of 11.4 million tonnes to about 10.9-11.0 million tonnes, versus 9.7 million tonnes harvested in 2018," Sabaranski said.

In Britain, wheat appeared in good condition although rains are also needed.

"Soil moisture is well below last year across most of the UK following last summer's drought," said Benjamin Bodart, director at CRM AgriCommodities.

"I would temper that following a rather dry winter, the root system of winter crops is rather well developed, so they would be able to cope for a bit longer with a prolonged period of dryness. But they are definitely thirsty," he said.

CRM AgriCommodites is forecasting a UK wheat crop of 15.1 million tonnes, up from last year's 14.0 million boosted.

News by Reuters, edited by ESM. Click subscribe to sign up to ESM: European Supermarket Magazine.

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