PARIS: Consultancy Strategie Grains on Thursday lowered its monthly forecast of soft wheat exports from the European Union and Britain in the 2020/21 season by 900,000 tonnes to 25.2 million to take account of a drop in demand, notably from China.
Hefty Chinese purchases this season had fueled a rally in European wheat prices to more than 7-year highs late last month, also supported by an export tax on Russian wheat exports. Prices have since pared some of the gains.
“European exports have seen potential export demand slip away in recent weeks due to a lack of competitiveness and because China is buying less French wheat than originally expected,” the French consultancy said in a report.
France has shipped nearly 1.6 million tonnes of wheat to China since the start of the season on July 1, Refinitiv port data showed.
Lower projected EU exports led the consultancy to raise its EU and UK wheat stocks forecast at the end of the 2020/21 season by about 1 million tonnes to 11.3 million.
“2020-crop wheat prices no longer appear to have any further increase potential,” it said.
In barley, it cut its forecast for 2020/21 ending stocks in the EU and Britain by around 1.2 million tonnes to 7.6 million tonnes, to reflect an increased projection of animal sector demand in Spain due to barley’s competitiveness compared to other cereals.
For the next season, Strategie Grains kept its estimate for soft wheat production in the EU’s 27 member countries at 129.6 million tonnes, up from 119.3 million last year, while the EU-27 barley harvest was still forecast at 54.0 million tonnes, down from 55.4 million in 2020.
But it raised its forecast of this year’s maize production, now seen at 65.0 million tonnes, against 64.6 million projected in February and sharply above the 62.5 million harvested last year, due to a rise in expected yields.
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