European Union wheat exports to China this season are expected to reach about 1 million tonnes, led by a run of French sales, after international trade disputes allowed Europe to shift some of its big 2019 crop, grain market sources said.
China is the world's largest wheat grower but also imports several million tonnes a year to cover its needs. The country rarely sources wheat from the EU, partly due to due to ocean freight costs. But a long-running trade standoff with the United States plus trade tensions with Australia and Canada have forced China to look elsewhere for wheat.
The 28-country EU shipped 727,000 tonnes of wheat to China between the start of the 2019/20 season on July 1 and Dec. 15, compared with 131,000 tonnes over the whole of the 2018/19 campaign and negligible volumes in four previous seasons, according to official EU data.
France, the EU's biggest wheat exporter, has already loaded more than 600,000 tonnes of wheat for China this season, port data shows. Traders in Europe and China say about 800,000 tonnes of milling wheat could be shipped in total from France, while another 240,000 to 260,000 tonnes are expected to be loaded in the Baltic states, mostly Lithuania.
"China had an issue with US, Australian and Canadian wheat so they fell back on European supplies," one trader said. A tariff battle between Washington and Beijing in the past 18 months has disrupted agricultural trade between the two countries, although an agreement announced last week calls for increased Chinese imports of US farm goods.
Political tensions with Australia and Canada have also led Beijing to restrict imports of crops from those countries. The EU wheat purchased by Chinese importers was flour grade, with French supplies covering requirements for soft wheat and the Baltic grain filling a higher-protein niche, traders said. EU common wheat production, excluding durum, rose by more than 14% this year after a drought-hit 2018 harvest.
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