The European Union's 2003/04 grain balance remains tight due to last year's poor harvests, while a recent rise in freight rates is hampering much-needed imports, analyst Strategies Grains said on Thursday.
In its February report, the French analyst said arrivals of maize in the EU had slowed significantly since mid-January and high freight rates had pushed up the price of imported wheat.
"The projected balance between supply and demand for cereals in the EU therefore remains fragile," Strategies Grains said.
"Realistically speaking, some of the wheat and maize imports we currently forecast can no longer be taken as guaranteed," it added.
Strategies Grains said large soybeans exports had created congestion problems in South American ports.
It cut its estimate for EU maize imports this season to five million tonnes from 6.2 million seen last month but still much higher than the 3.1 million imported in 2002/2003.
Wheat imports were expected to be 4.3 million tonnes, unchanged from last month's estimate.
Strategies Grains predicted a slight fall in EU wheat prices, although there was a chance that higher maize prices, brought on reduced imports, could feed through into wheat and barley.
"Maize prices now have virtually no potential for decrease," the analyst said.
"Brief jolts upward in response to delays in import arrivals could be possible, and these could have a knock-on bull effect on wheat and barley prices."
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