Rapeseed yields, in the EU are predicted to be 3.8% down on the five year average but slightly above (2.4%) 2019 harvest. Hungary has witnessed particularly heavy rainstorms which has delayed ripening and caused harvest losses. Hungary is forecast to produce 2.59t/ha – a 16% decrease on its five year average. The EU is anticipated to import a record 6.1 MMT of Rapseed during the 2020/21 season. Prices are currently edging upwards.
Wheat – the markets are extremely focused on Russia as the largest wheat exporter. Approximately 50% of the Russian wheat area is harvested with most recent forecasts increasing their overall assessments. IKAR have increased their wheat forecast to 79.5 MMT and wheat prices (Class 4) are Euro 162/ tonne ex farm – although this has been helped by a recent weakening of the Ruble. European wheat forecasts have decreased recently with Strategie Grains revising their EU-27 plus UK downwards below 130 MMT with a 3 MMT cut across France, Bulgaria and Romania being partly offset by a 1.5 MMT increase coming from Poland and Germany. Last year’s EU-27 plus UK crop was 147 MMT so a decrease of 11% compared to last year. However, much is being made of the Russian spring wheat crop which is still to begin in earnest as it was hit by hot dry conditions at grain fill. Kazakhstan has raised its 2020 grain forecast from 18 MMT to 20.5 MMT. Brown & Co anticipate Russian overall wheat to be lower than currently forecast due to a) lower yields being seen in the south and b) spring wheat areas being hit to a greater extent that reported.
Barley – EU-27 barley production estimates have been cut by the EU Commission to 54.1 MMT compared to 55.1 MMT last year. Malting demand is slightly muted due to COVID-19 factors affecting demand and tough competition for feed, coming from Corn. Nearly all EU regions are facing small reductions in yields with the exception being Poland, which is estimated to see a 4.3% increase on last years yields. Malting barley prices in Poland are currently Euro 145/ tonne. Ukraine yield forecasts are for a reduction of 5.6% compared to 2019. Two other key markets (for Winter Barley) are Romania and France where production forecasts are 18% and 10% lower than 2019, respectively. However, Spring Barley is forecast to be up 6.4% across the EU.
Corn – yield forecasts everywhere look to be well above (8.3%) 5 year averages for the main producing countries of the EU. At the same time, prices have consistently been softening on the back of good weather in the US and a firming view that a global record harvest may be feasible. This has more than outweighed key concerns over French corn and crops in Southern Russia. Ukraine corn is forecast to see a 4.2% increase compared to 2019 and a 14% increase in comparison to the 5 year average. Prices are expected to soften when Ukraine starts harvest. The U.S. is forecast to produce 394 MMT which is 6% down on June forecasts but still estimated to be the largest crop in recent history.
