BRUSSELS, BELGIUM — E.U. cereal production in 2019-20 is expected to recover from last year’s low with increases anticipated in wheat, barley and corn, according to the E.U. agricultural markets short-term outlook report.
Total production is expected to reach 311 million tonnes if good weather conditions continue until the end of harvest.
Wheat production should increase by 11% to 142 million tonnes, while barley is expected to grow 7% to 60 million tonnes and corn is expected to grow by 0.5% to 69 million tonnes.
Drought conditions across the E.U. significantly affected cereal production in 2018-19, which dropped to a six-year low. As a result, E.U. prices peaked over the summer, but then stabilized and ultimately declined at the beginning of 2019 thanks to good global availability.
E.U. exports faced fierce competition from other exporting countries. Wheat from the Black Sea region remained competitive until the first quarter of 2019, when lower availability in the region allowed E.U. exporters to regain some market share, according to the report.
The E.U. continues to be the top corn importer in the world. As a consequence of the higher imports, E.U. cereal net exports reached only 2 million tonnes.
Planted area also is expected to recover from last marketing year’s low to 56 million hectares, a similar level to the five-year average.
Feed use is expected to remain stable compared to 2018-19 (in view of the expected livestock production developments). Thanks to larger supplies, cereal net trade should recover over the next marketing year to 17 million tonnes.
Oilseeds production, forecast at 32.3 million tonnes, is likely to further decrease in 2019-20 due to the small E.U. rapeseed sowing area (down 10% compared to average).
The drop in E.U. oilseeds production gave room for more imports, which reached a record level of 20 million tonnes. Imports rose for soybeans (8% above the five-year average) due to low world prices; such import levels had not been reached since 2007-08.
Trade frictions between the United States and China and lower demand from China (African swine fever) have resulted in a significant global surplus that pushed down global soybean prices. Prices have recently picked up again due to poor sowing conditions in the United States.
In 2019-20, E.U. oilseed sowing area declined to 11.5 million hectares; E.U. production is expected to decrease by 1.7%. Rapeseed area was negatively affected by dry conditions at the sowing and crop emergence period, thus production should further decline to 19 million tonnes. E.U. production of soybeans and sunflower is expected to rise, reaching 2.9 million tonnes and 10.6 million tonnes, respectively.