FranceAgriMer cuts wheat export outlook, raises stocks again

PARIS: FranceAgriMer on Wednesday lowered its forecast of French soft wheat exports in 2021/22, partly due to stalled sales to Algeria, leading the farm office to raise its end-of-season stocks projection for a third straight month.

In a monthly supply and demand outlook for major cereal crops, the office reduced its forecast of soft wheat exports outside the European Union to 9.0 million tonnes from 9.2 million in December, and trimmed its projection of intra-EU exports to 7.7 million tonnes from 7.8 million.

After a slow start to the campaign, linked to a late harvest and uncompetitive prices, French export prospects have been further curbed by a drop-off in shipments to key market Algeria, Marc Zribi, head of FranceAgriMer’s crop unit, told reporters.

French wheat has been overlooked in Algeria’s two most recent tenders, according to traders, and Zribi said the trend seemed to be linked both to diplomatic tensions between Paris and Algiers as well as the attractiveness of other origins like Russian wheat.

It was hard to anticipate Algerian imports in the rest of the season, including in a new tender called for Thursday, but traders were still optimistic a loss of French sales there could be at least partly offset by more shipments to China, Morocco and Egypt, he added.

French soft wheat stocks at the end of the 2021/22 season on June 30 were now seen at 3.6 million tonnes, up from 3.5 million estimated last month and potentially the biggest since 2004/05.

The stocks outlook could be revised substantially in the coming months, however, given uncertainty over exports as well as the impact of a bird flu outbreak on livestock feed demand and of the coronavirus pandemic on food consumption, Zribi said.

In a sign of wheat’s improving competitiveness, FranceAgriMer increased its forecast of domestic demand for soft wheat in feed by 50,000 tonnes to 4.7 million, while reducing maize feed use by the same amount.

The office kept unchanged its forecasts for stocks of barley and maize at the end of 2021/22, at 1.4 million and 1.9 million tonnes, respectively.