French wheat stocks estimate raised, still at 5-year low

PARIS: Farming agency FranceAgriMer on Wednesday raised its estimate of French soft wheat stocks at the end of the 2018/19 season last month but the volume was still a five-year low for the European Union's biggest wheat producer.

In monthly cereal supply-and-demand data published on its website, FranceAgriMer pegged stocks of soft wheat at the end of the past season on June 30 at 2.5 million tonnes.

That was up from 2.4 million tonnes estimated a month ago, but well below an average 2.9 million for the previous five seasons and the lowest volume since 2013/14.

The relatively low stocks volume could help France absorb what is expected to be a much larger wheat harvest this year, particularly given what traders see as tepid export demand at the start of the new 2019/20 season.

On-farm wheat stocks, estimated separately to FranceAgriMer's main commercial stocks figure, were also expected to have fallen to a five-year low at 400,000 tonnes.

The upward adjustment to FranceAgriMer's 2018/19 wheat stocks estimate mainly reflected a 200,000 tonne reduction for a demand category covering non-specified miscellaneous uses in France.

Wheat demand was also trimmed due to a slight decrease in French soft wheat exports outside the EU in 2018/19, to 9.7 million tonnes from 9.75 million last month.

A downward revision to French non-EU exports had been expected by traders after a slow end to the season in which France notably saw competition from other origins in its main overseas market Algeria.

The 2018/19 soft wheat exports outside the EU would nonetheless be 19.5% above the 2017/18 level, while shipments within the EU were seen falling around 18% to 7.6 million after a strong previous season.

For other cereals, FranceAgriMer lowered its estimate of 2018/19 maize ending stocks to 2.8 million tonnes from 3.0 million, notably due to a 100,000 tonne increase to intra-EU exports and a 50,000 tonne reduction in imports.

However, expected maize stocks that would be up nearly 10% against 2017/18 ending stocks and also well above a five-year average of 2.5 million.

Estimated barley ending stocks in 2018/18 were increased to 1.6 million tonnes from 1.5 million, mainly due to reduced export estimates, and would now be 7.5% above the 2017/18 level.