September 13, 2018 / 10:15 AM / 13 days ago

Strategie Grains cuts EU maize outlook after hot summer

PARIS (Reuters) - Consultancy Strategie Grains cut its outlook for grain maize production in the European Union by nearly 5 percent as crop conditions continued to deteriorate over the summer due to hot and dry weather in France and central Europe.

FILE PHOTO: Rudiment maize plants are pictured in a dried out field near Sittensen, between the northern German cities of Bremen and Hamburg, Germany, August 18, 2018. REUTERS/Wolfgang Rattay/File Photo

In a report published on Thursday, the French-based firm estimated this year’s grain maize crop in the 28-member bloc at 58.4 million tonnes, down from 61.3 million pegged last month and 59.3 million harvested last year.

“Yield potentials have deteriorated significantly again in France, Germany, Poland and central Europe, due to this summer’s hot, dry weather. These unfavorable conditions will ultimately take a heavy toll on the EU’s grain maize harvests,” Strategie Grains said in a report.

France on Tuesday cut its estimate for the spring crop by 400,000 tonnes to take account of this summer’s weather.

In contrast, the outlook for grain maize yields remained excellent major producers in Romania, Bulgaria and Italy, Strategie Grains said.

Drought and heatwaves since late spring have withered crops in northern Europe, fuelling concern about tightening grain supplies and sending Paris wheat futures to their highest in over five years.

Strategie Grains cut its estimate for this year’s EU soft wheat harvest for the seventh consecutive month, now seen at 126.8 million tonnes, down 0.9 million from last month, due mainly to reductions in Germany, the Benelux, Denmark, Ireland, Austria, Finland and Sweden.

The 2018 EU soft wheat harvest would now be 11 percent below last year’s with yields at their lowest level since 2012.

As a consequence of the tighter supplies and taking account of strong competition from Black Sea wheat, the analyst cut its projection for EU soft wheat exports this season by 1 million tonnes to 18.8 million tonnes, down from 19.8 million forecast in August and 20.5 million last season.

This would lead to a rather tight EU balance sheet, with projected carry out stocks barely exceeding 10 million tonnes of soft wheat, it said.

For barley, Strategie Grains cut its monthly crop forecast by 0.5 million tonnes to 56.6 million tonnes, against 58.4 million last year.

In terms of quality, soft wheat grain quality was confirmed as excellent in France and satisfactory in most countries except Romania and Bulgaria, which suffered from rainy weather during harvesting.

Spring malting barley quality was penalized by high protein content in the north and central EU countries.

Reporting by Sybille de La Hamaide; editing by David Evans

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