Dry week raises worry about German grain crops

Another hot, dry week in Germany is raising concerns about possible damage to crop yields in the European Union's second-largest wheat producer and largest rapeseed grower, analysts said on Friday. Germany's national weather service said only 38 percent of average monthly rain fell in April. Showers are forecast next week, but this may be too late for rapeseed, crop watchers said.
"Some isolated rain this week was not enough to change the picture and there is increasing worry that grains yields will now be lower," one analyst said. "For rapeseed, there is belief that some plants have passed the tipping point after which they will not recover even if rain comes."
The prolonged period of dry weather in Germany has now started to damage grain and rapeseed crops, German farming association DBV said on Wednesday. "For wheat and other grains there is still time for crops to recover if they get enough rain in coming weeks, although people have given up any hopes of a bumper grain harvest this year," another analyst said.
"But yield expectations are being cut as both grains and rapeseed plants were already weakened by an especially hard winter." Rain fell in late April in central and south Germany, and wheat crops in these regions are generally in a reasonable state although urgently needing rain, analysts said.
Germany's farm co-operatives association forecast around mid-April that the overall 2011 grain crop was likely to decline to 44.1 million tonnes from the 44.2 million in 2010, when crops were damaged by rain. The 2011 rapeseed crop was forecast to fall to 5.2 million tonnes from 5.73 million, the cooperatives said.
"For rapeseed, people are now expecting a big cut in crop estimates in coming weeks," a trader said. "Dry weather is forecast in coming days, and it looks like things could be over in the next week or so for some rapeseed plants." Germany is forecast to have no rain at all up to Monday night. From Tuesday to Thursday, showers are forecast that could help grains but may be too late for rapeseed.
Given some market estimates that about 50 percent of the upcoming rapeseed crop has been sold in advance, hurting farmers if they cannot deliver what they have sold. "We are getting a lot of requests by farmers in north and east Germany to wash out (cancel) advance rapeseed sales contracts," one rapeseed trader said. "Some farmers in north and north-east Germany are talking about 50 percent crop losses in rapeseed, which is worrying."