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Monthly report, Strategie grains. Overview of the European grain market in term of production/surface/output. Mail me if you wish to get the latest report for free.

Monthly report, Strategie grains. Overview of the European grain market in term of production/surface/output. Mail me if you wish to get the latest report for free.

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  • 1. Nineteenth year - No 221 / 12 May 2011 - English version © 2011 Tallage SAS. All rights reserved. No part of this publication may be reproduced, photocopied, stored in a retrieval system or transmitted, in any form or by any means, nor otherwise circulated without the prior consent of the publisher. Action will be taken against any person, company or organisation infringing copyright. The next issue of Stratégie grains will be available on 16 June 2011 stratégiegrains® strategie-grains.com soft wheat 2010/11 2011/12 July-June asof 13/04/11 as of 11/05/11 carry-instock 13.4 8.6 8.7 production 126.4 135.2 131.5 imports 2.3 3.9 3.8 domesticuse 114.3 118.5 117.1 exports 19.1 19.0 16.8 freecarry-outstock 8.7 10.2 10.1 interv.stock carry-outstock 8.7 10.2 10.1 surplus/requiredstock -1.9 -0.7 -0.7 barley 2010/11 2011/12 July-June asof 13/04/11 as of 11/05/11 carry-instock 15.6 8.3 8.2 production 52.9 54.5 54.2 imports 0.2 0.2 domesticuse 55.3 53.9 53.9 exports 5.0 3.4 3.0 freecarry-outstock 7.7 5.2 5.5 interv.stock 0.5 0.5 0.2 carry-outstock 8.2 5.7 5.7 surplus/requiredstock 2.5 0.1 0.5 maize 2010/11 2011/12 October-Sept. asof 13/04/11 as of 11/05/11 carry-instock 6.0 6.1 6.0 ofwhicholdcropmaize 4.0 3.8 3.6 production 54.9 59.5 59.1 imports 6.8 4.6 4.8 domesticuse 61.1 64.5 63.7 exports 1.0 1.0 1.0 freecarry-outstock 3.6 2.4 2.8 stockintervention harvestbefore1Oct 2.3 2.3 2.3 carry-outstock 6.0 4.7 5.1 surplus/requiredstock 1.6 0.0 0.6 Monthly summary 3 European Union wheat,barley and maize output 6 Crop year 2011/12 6 Crop year 2010/11 13 Cereal consumption in the animal feed sector 14 EU27 Industrial feed production 14 Breakdown of raw material consumption in animal feeds in 2011/12 15 Breakdown of raw material consumption in animal feeds in 2010/11 16 European Union wheat balances 19 Supply and internal demand 20 Price comparison between the different origins dated 6/05/2011 23 Intra-EU wheat trade 24 World wheat market 26 Analysis of ending stocks and conclusion 32 European Union barley balances 33 Supply and internal demand 33 Intra-EU barley trade 38 World barley market 38 Analysis of ending stocks and conclusion 42 European Union maize balances 45 Supply and internal demand 48 Intra-EU maize trade 49 World maize market 51 Analysis of ending stock and conclusion 53
  • 2. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 graphs and tables Graphs Tables 2 Table1.1:area,yieldsandproductionforwheat,barleyandmaize 7 Table1.2:EuropeanUnioncerealproduction2008/09-2011/12(EU27) 8 Table1.3:changesinareaforthemaincrops(EU27) 8 Table1.4:SSPandFranceAgriMerestimatesforcropproductionsinFrance 10 Source:SSPdated5May;FranceAgriMerdated11May2011 10 Tableau1.5:estimatesforpercentageoftotalwheatproductionmeetingcriteriaformillingineachEUcountry(cropyears2008/09,2009/10and 2010/11) 13 Table2.1:changesinEU27industrialcompoundfeedproductionbycountry 14 Table2.2:factorydeliveredpricesforthemainrawmaterials(deliveredBrittany, €/t,wholeprices) 15 Table2.3:factorydeliveredpricesinCatalonia,Spain(€/t) 16 Graphic2.4:elasticityofdemandforgrainsinresponsetopricemovementsinSpain,2011/12(comparisonagainstlastmonth) 17 Table2.4:tonnageofthemainrawmaterialsusedinindustrialfeedsandon-farm(EU27) Table2.5:wheat,barleyandmaizeconsumptioninEUanimalfeeds–industrialandon-farm(Mt) Table3.1:breakdownofEU27importsbycountryoforigin 20 Table3.2:EU27wheatbalanceJuly/June2011/12(kt) 21 Table3.3:EU27wheatbalanceJuly/June2010/11(kt) 22 Table3.4:wheatpricesinvariousEUcountriesasof06/05/2011 24 Table3.5:spreadsbetweenFrenchandUKwheatpricesdated06/05/2011,deliveredItalyandSpain 24 Table3.6:intra-EU27wheattrade2011/12(kt) 25 Table3.7:intra-EU27wheattrade2010/11(kt) 25 Table3.8:FOBpricesofmajorworldwheatoriginsasof06/05/2011 26 Table3.9:worldwheatbalance(softanddurum) 28 Table3.10:estimatedRussian,UkrainianandKazakhstanwheatbalances 28 Table3.12:worldwheatbalance(softanddurum)formainexportingcountries 29 Table3.11: worldimportrequirementsforsoftwheat(excludingproducts)andprojectedexports– Mt—July-June 31 Table3.13:EU27wheat(grain)exporttothirdcountriesbymaindestinations 31 Table3.14:comparisonsofnewcropopenmarketandinterventionprices(06/05/2011) 32 Table4.1:estimatedEUmaltingbarleyproduction(2011/12and2010/11) 34 Table4.2:EU27barleybalanceJuly-June2011/12(kt) 35 Table4.3:EU27barleybalanceJuly-June2010/11(kt) 36 Table4.4:forecastforresaleofinterventionbarleyin2010/11(kt) 37 Table4.5:intra-EU27barleytrade2011/12(kt) 39 Table4.6:intra-EU27barleytrade2010/11(kt) 39 Table4.7:estimatedsupplyanddemandbalancesheetsforthemainimportingcountries 40 Table4.8:worldbarleybalance 40 Table4.9:changesinexportavailabilitiesandimportrequirementsforthemainbarleytradingcountries 40 Table4.10:EU27barleyexportsontheworldmarkettomainthirdcountrydestinations 41 Table4.11:EUbarleyinterventionstockasof06/05/2011 42 Graphic1.1:rainfallvolumesinSpain(mm)inApril 9 Graphic2.1:soymealprices 15 Graphic2.2:soya/wheatpriceratioinFrance 15 Graphic2.3:elasticityofdemandforgrainsinresponsetomaizepricemovementsinFrance,2011/12 (comparisonagainstlastmonth) 17 Graphic3.1:changesinGerman,UKandFrenchwheatprices 23 Graphic3.2:changeinworldwheatpricesonaper-monthbasis(FOBmainoriginsinUS $/t) 27 Graphic3.3:wheatfuturesattheChicagoBoardofTrade 29 Graphic3.4:changesinworldwheatstocks(includingdurumwheat) 30 Graphic4.1:worldbarleyandmaizeprices(FOBmainoriginsinUS$/t) 40 Graphic4.2:wintermaltingbarleypricesinFranceandpremiumsoverfeedbarleyprices 44 Graphic4.3:springmaltingbarleypricesinFranceandpremiumsoverfeedbarleyprices 44 Graphic5.1:Americanmaizeprices(FOBGulf) 51 Graphic5.2:Frenchmaizeprices(€/t) 54
  • 3. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 monthly summary Monthly summary 3 Production EU cereal harvests revised down Cropyear2011/12 There has been very little rainfall since last month in most European countries and yield potentials for wheat and barley in sev- eral countries have already been impacted. Our forecast for total grain production in the EU therefore decreases by 5.1 Mt this month to 284.7 Mt (compared with 274 Mt in 2010/11). EU soft wheat production registers the largest reduction, dropping 3.6 Mt since last month to 131.5 Mt. This is neverthe- less still larger than last year’s wheat har- vest (126.4 Mt). West EU countries are the worst affected by the deterioration in yield potentials (- 3 Mt), whilst the central European countries have fared better (- 0.3 Mt). We now know the extent of winter- kill in Lithuania, and wheat production is therefore revised down by 0.3 Mt, with the corresponding area reallocated to spring crops. EU barley production is revised down by 0.3 Mt this month to 54.2 Mt (compared with 52.9 Mt in 2010/11). At the EU level, the reduction is small because a sharp de- cline in the west EU countries (- 0.9 Mt) is mostly offset by a rise in estimated pro- duction in Spain (+ 0.4 Mt thanks to good rainfall levels in April) and by a sharp rise for spring barley production in the Baltic countries (+ 0.3 Mt). EU maize grain production is revised down by 0.4 Mt this month to 59.1 Mt (compared with 54.9 Mt in 2010/11) re- flecting adjustments to crop area forecasts. French maize production is revsied down by 0.6 Mt whilst production in the central and southeast EU countries is revised up slightly (+ 0.2 Mt). Lastly, we estimate durum wheat produc- tionat8.3Mt,down0.1Mtsincelastmonth (compared with 9.1 Mt in 2010/11). Cropyear2010/11 Total grain production 2010/11 in the EU is revised up by 0.4 Mt this month to 274Mt(lastyear:291.8Mt).Thisriseisex- plained by a 0.4 Mt increase in soft wheat production to 126.4 Mt (last year: 129.1 Mt), reflecting adjustments for Latvia, Belgium and Romania. Barleyproductionisunchangedat52.9Mt (last year: 61.8 Mt). Maize grain production is revised up by 0.08 Mt this month to 54.9 Mt (last year: 57.4 Mt). EU animal feeds New increase for EU industrial feed production but reduction in demand for ce- reals Cropyear2010/11 Industrial feed output is revised up by 0.4 Mt this month to 137.9 Mt, reflecting the inclusion of the latest data from Germany in our forecasting. Estimated demand for cereals is revised up by 1 Mt this month but remains forecast significantly lower than in 2009/10 (-5.4 Mt). Cropyear2011/12 Estimated feed output in 2011/12 in- creasesinlinewiththismonth’schangesfor 2010/11.Itissettoremainatasimilarlevel to2010/11.Bycontrast,estimatedgrainus- age in animal feeds is forecast to decline in line with this month’s reductions to harvest estimates and hence availabilities for on- farm grain usage. The downward correc- tion concerns wheat and maize. Table4.12:EUbarleypricesasof06/05/2011 42 Table4.13:comparisonofthemaltingbarleysituationin2011/12withsituationsfrom2006/07to2010/11 43 Table5.1:EU27maizebalancesbycountry(kt):October-September2011/12 46 Table5.2:EU27maizebalancesbycountry(kt):October-September2010/11 47 Table5.3:breakdownofEU27imports(byorigin) 48 Table5.6:spreadbetweenmaizeandwheatpricesinFrance 49 Table5.4:intra-EU27maizetradeOctober-September2011/12(kt) 50 Table5.5:intra-EU27maizetradeOctober-September2010/11(kt) 50 Table5.7:USandworldmaizebalancesheets(Mt) 51 Table5.8:maizebalancesheetsforArgentinaandBrazil 52 Table5.9:maizebalancesheetsforRussiaandUkraine(Mt) 52 Table5.10:maizebalancesheetsforChinaandSouthAfrica(Mt) 52 Table5.11:changesinexportavailabilitiesandimportrequirementsformaincountries 52 Table5.12:MaizepricesintheEUasof7/05/2011 53 Table5.13:FrenchandSpanishmaizebalances–July-Junecropyears–for2009/2010,2010/11,2011/12 54 Table5.14:breakdownofEU27maizeinterventionstocksasof7/05/2011(kt) 54
  • 4. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 monthly summary 4 EU wheat EU wheat stock not set to rise greatly in 2011/12 – outlook for prices essential- ly bullish but movements will hinge on export policies in Russia and Ukraine Cropyear2010/11 EU wheat production in 2010 is revised up by 0.4 Mt although wheat imports fall by 0.3 Mt. Internal demand is revised up by 0.4 Mt (increase in demand in animal feeds offset by a reduction in milling); wheat ex- portsontheworldmarketarereviseddown by0.3Mtthismonthto19.1Mt.EUwheat stock on June 30 2011 therefore remains at a similar level to last month at between 8.5 and 9 Mt, which is almost 2 Mt less than the minimum stock required (to comfort- ably supply the market from June 30 until the next harvest comes in). The situation remains particularly tight in France, UK, Central Europe (Hungary and Poland) and southeast Europe (Romania/Bulgaria). Germany’s balance has tightened since last month. After the upward price movements seen at the beginning of May, this low stock fore- cast should prevent old crop prices fall- ing sharply even though the likelihood of Russia’s and Ukraine’s early return to the market has increased. Cropyear2011/12 EU wheat production in 2011 falls sharply thismonthto131.5Mt(-3.6Mt)duetothe impactofthedroughtinthewestEUcoun- tries and to winterkill losses in Lithuania andPoland.Consequently,projectedwheat usage in on-farm animal feeds falls sharply (-1.3 Mt) but demand for wheat in animal feedsisstillforecasthigherthanin2010/11 (with demand captured from other grains). Demand for human consumption and in- dustrialusageisalsosettobehigherthanin 2010/11 (mainly biofuels sector) although this forecast has not altered significantly since last month. Intra-EU wheat trade is forecast to rise in 2011/12 on account of higher internal demand (Netherlands mainly). Import volumes are set to fall sharply compared with the levels of 2010/11 in Germany and France (assuming that grain quality is in linewiththenorminGermany).UKwheat remains much more competitive than French wheat for export to the south EU export destinations; meanwhile south-east EUwheatiscompetitiveagainstUKwheat (and much cheaper than French wheat) for the south EU. Weestimatethatwheatstocksontheworld market on July 1 2011 will be 20 Mt less than at the start of 2010/11. Global pro- duction is forecast to increase by 28 Mt but our estimate has decreased sharply since last month due to the drought in the EU, delays to plantings in the northern USA and, to a smaller extent in the Black Sea countries. World demand is still forecast high (690 Mt) due to the projected rise in demand for feed wheat at the expense of maize. Global wheat stocks at the end of 2011/12 will therefore decline slightly. World wheat trade in 2011/12 is set to be higher than in 2010/11 due to reduced production in the Middle East and higher animal sector demand in Asia. In this con- text, we still envisage that the world market will require the totality of the EU’s export availability despite the combined 14 Mt in- crease in the availabilities in the Black Sea countries (Russia, Ukraine, Kazakhstan). Since last month we have reduced our fore- cast for EU wheat availability and we now forecast exports at barely 17 Mt. With this level of exports, the outlook for EU wheat is not heavy and stocks will remain low at the end of 2011/12. Generally speaking, this situation should support new crop EU wheat prices, which are much cheaper than US prices. The fact that the outlook on the world market is fairly tight with relatively low stock forecasts is a second support factor. Nevertheless, wheat prices in the EU could still be momentarily influenced downwards when Russia and Ukraine re- sume exports in the summer. EU barley Rather heavy situation for end-2010/11 but much tighter outlook for 2011/12, despite a reduction for projected exports Cropyear2010/11 Little change this month for production, importsandexports.Demandforbarleyfor human consumption and industrial usage has been revised down this month, whilst projected barley usage in animal feeds in- creases. AsofMay6,2.5Mtofbarleyhadbeensold from intervention via traditional tender- ing (out of total estimated sales by June 30, 2011of2.7Mt)and1.6Mtviathefoodaid programme (out of total estimated sales of 2.2 Mt by June 30, 2011). The volume of intra-EU barley trade is es- timated up to 10 Mt to take account of the latest customs statistics. We now estimate a barley surplus of 2.5 Mt (over the level of stock required to com- fortably supply the market until the next harvest arrives) on June 30, 2011, mainly splitbetweenGermany,FranceandPoland. This should exert downward pressure on old crop prices. Cropyear2011/12 EUbarleyproductionin2011/12isrevised down by 0.3 Mt this month to 54.2 Mt, which is 1 Mt more than in 2010. The re- ductionsincelastmonthreflectstheimpact of the dry weather on barley yields. We es- timate malting barley production at 11 Mt (up from 10 Mt in 2010/11). Demand for barley for human consump- tion and industrial usage should slightly increase to 11.4 Mt reflecting increased demandfor maltingbarleyand ona smaller scale, increased demand for barley in bio- ethanol production. Demand for barley in animal feeds is set to fall by 1.7 Mt in 2011/12 to 39.1 Mt; the decline is due to barley’s less competitive position in industrial feeds (demand trans- ferred to wheat and maize).
  • 5. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 monthly summary 5 Intra-EU barley trade is set to be sharply down on the level of 2010/11, due to high- er domestic availability in Spain and lower projected animal sector demand in the Benelux. Wecurrentlyforecastthatworldbarleypro- duction will increase by 11 Mt, which will offset the reduction in stocks at the begin- ningof2011/12.Consequently,withworld demandsettoincreaseby5Mt,theoutlook for the world barley market in 2011/12 is tight. Barley trade on the world market is set to remain close to the level of 2010/11 at14.6Mt.Thismonthwepublishourfirst breakdown of estimated EU exports on the world market by destination countries; we estimate total EU exports at 3 Mt (down from 5 Mt in 2010/11). This level repre- sents almost all the EU’s exportable surplus (estimated at 3.5 Mt). Hence EU barley supply and demand in 2011/12 is already looking set to balance, except in the east EU countries. This out- look is neutral in terms of new crop barley prices. The reduction in world demand addressed to the EU (due to the rise in Ukrainian availabilities) will be one of the most important factors in terms of limiting the increase potential for EU barley prices. On the other hand, prices have little poten- tial for decrease due to the tight (or at least finely balanced) outlooks for EU wheat and maize supply and demand. Malting barley production is still forecast 1 Mt up on the level of 2010. However, if the dry conditions persist, barley yields could face further reductions and quality could also be affected. The outlook for malting barley in 2011/12 is therefore set to be tighter than in 2010/11. The malting barley premiums have in- creased sharply since last month, reflecting concerns over the lack of rainfall in recent weeks. The premiums are now high and will have little potential for decrease until rains return. EU maize Outlook for 2010/11 remains heavy whilst supply and demand are close to bal- ance for 2011/12 (small surplus); tight world market will support prices Cropyear2010/11 Maize imports are revised down by 0.3 Mt this month to 6.75 Mt, reflecting the fact that imported maize remains uncompeti- tive through the last months of crop year 2010/11; Ukrainian maize is the only ori- gin that is competitive in the EU over this period, and only for south EU import des- tinations. In addition, the risk of trace pres- ence of a GM variety not yet authorised in the EU will restrict the volume of imports from Brazil until August. Demand for maize in the bioethanol sector is revised up a little this month (+0.15 Mt). Demand for maize in animal feeds is re- vised down by 0.3 Mt. Projected EU maize stock on September 30 2011 therefore de- creases slightly this month but the EU bal- ancesheetstillhasapotentialmaizesurplus of 1.6 Mt. The outlook for EU maize therefore re- mains intrinsically bearish. However, the situation on the world market is still ex- tremely tight for 2010/11 and 2011/12 (feed demand currently allotted to maize on the world will need to be rationed and transfer to other grains). If world prices rise from their current levels, imported maize willbecome lessattractivein theEU, which wouldallowtheEUmarkettotightenwith- out a corresponding need for EU prices to decrease significantly. Nevertheless barley intervention stocks will continue to be re- leased onto the internal market generating possible downward pressure on EU maize prices. Cropyear2011/12 Despite a reduction to estimated French maize production this month, we still en- visage that the EU’s maize harvest in 2011 will be significantly better than in 2010 (+4.2 Mt to 59.1 Mt). Imports from third countries are forecast to fall by 2 Mt to 4.8 Mt due to the less competitive position of imported third country maize compared with 2010/11 (based on current prices for November 2011 deliveries). Internal de- mand for maize in the EU is still forecast up by 2.7 Mt compared with 2010/11. Animal sector demand is forecast up by 2.4 Mt, mostly on account of increased maize usage in on-farm feeds and of demand for human consumption and industrial usage (up by 0.3 Mt). EU maize stock is forecast todecreaseby1Mtthrough2011/12to5.1 Mt; this level is significantly greater (+0.6 Mt) than the minimum stock needed to comfortably supply the market until the next harvest arrives. Maize stocks on the world market are fore- cast to rise by 6 Mt in 2011/12 to 115 Mt. However, at this stage, this increase cannot be taken completely for granted because it will depend on a significant rise in produc- tion (+44 Mt to 850 Mt), and at present maize plantings in the USA are badly be- hind schedule; this could mean that esti- mated maize area will need to be reduced if conditions are not ideal for plantings during the next few weeks. Ending stock 2011/12 is currently estimated at 13% of annual global demand, which remains relatively low. Even though rationing of de- mand in animal feeds (over to feed wheat) has already begun, it has not happened to a sufficientextenttoenableworldsupplyand demand to balance. New crop maize prices therefore have no potential for decrease until harvest outcomes are certain. On the contrarytheystillhaveanincreasepotential in order to generate further reductions in demand; this will be intensified if plantings in the USA do not match current forecasts. At present new maize prices in the EU are cheaper than new crop prices. However, the outlook in 2011/12 is now much less heavy than the situation in 2010/11: this price differential should therefore narrow, either via a decrease in old crop prices or an increaseinnewcropprices.Thelattercould be emphasized by the tight situation on the world market. However, if farmers planting intentions in the USA have been fully at- tained by mid-June and the crops develop correctly in Ukraine and Russia, this would generate a less tight outlook for 2011/12, which could allow for a reduction in 2011- crop prices.
  • 6. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat, barley and maize output European Union wheat,barley and maize output 6 Soft Wheat (Mt) EU 27 Barley (Mt EU 27 Maize (Mt) EU 27 129,1 126,4 131,5 2009/2010 2010/2011 2011/2012 61,8 52,9 54,2 2009/2010 2010/2011 2011/2012 57,4 54,9 59,1 2009/2010 2010/2011 2011/2012 Crop year 2011/12 There has been very little rainfall since last month in most European countries and yield potentials for wheat and barley in several countries have already been impacted. Our forecast for total grain production in the EU therefore decreases by 5.1 Mt this month to 284.7 Mt (compared with 274 Mt in 2010/11). EU soft wheat production registers the largest reduction, dropping 3.6 Mt since last month to 131.5 Mt. This is nevertheless still larger than last year’s wheat harvest (126.4 Mt). West EU countries are the worst affected by the deterioration in yield potentials (- 3 Mt), whilst the central European countries have fared better (- 0.3 Mt). We now know the extent of winterkill in Lithuania, and wheat production is therefore revised down by 0.3 Mt, with the corresponding area reallocated to spring crops. EU barley production is revised down by 0.3 Mt this month to 54.2 Mt (compared with 52.9 Mt in 2010/11). At the EU level, the reduction is small because a sharp decline in the west EU countries (- 0.9 Mt) is mostly offset by a rise in estimated production in Spain (+ 0.4 Mt thanks to good rainfall levels in April) and by a sharp rise for spring barley production in the Baltic countries (+ 0.3 Mt). EU maize grain production is revised down by 0.4 Mt this month to 59.1 Mt (compared with 54.9 Mt in 2010/11) reflecting adjustments to crop area forecasts. French maize production is revsied down by 0.6 Mt whilst production in the central and southeast EU countries is revised up slightly (+ 0.2 Mt). Lastly, we estimate durum wheat production at 8.3 Mt, down 0.1 Mt since last month (compared with 9.1 Mt in 2010/11). Crop year 2010/11 Total grain production 2010/11 in the EU is revised up by 0.4 Mt this month to 274 Mt (last year: 291.8 Mt). This rise is explained by a 0.4 Mt increase in soft wheat production to 126.4 Mt (last year: 129.1 Mt), reflecting adjustments for Latvia, Belgium and Romania. Barley production is unchanged at 52.9 Mt (last year: 61.8 Mt). Maize grain production is revised up by 0.08 Mt this month to 54.9 Mt (last year: 57.4 Mt). Crop year 2011/12 Droughtpersist–rainisnowindispensable In the last issue of Stratégie grains (SG 220), we highlightedhowdryMarchhadbeenthroughout mostofEuropeandthatrainswereurgentlyneeded tomaintainwheatandbarleyyieldpotentials.As thingsturnedout,therewasbarelyanyrainfallin EuropeduringAprilorthebeginningofMay.The rainthatdidfallwaslimitedtotheMediterranean- rim countries and – to a lesser extent – Bulgaria andRomania.AcrossmostoftheEU,cumulative rainfallhasbeenatleast50%lessthantheseasonal normforthistimeofyear.Somerainisexpectedin Europebetweennowandmid-May;itwillneed tobequitesignificanttoproviderespitefromthe stresscurrentlyaffectingthegraincrops. The wheat plants in the EU are mostly in the extension phase and are rapidly approaching ear formation and flowering, thanks to the high temperatures. For most of the EU27 countries (excepttheMediterraneanandBalkancountries), the persistence of a rainfall deficit could mean that plant biomass at flowering is smaller than normal. This handicap is likely to be particularly pronounced in west Europe, where wheat development is the most far advanced and the impact of drought stress is most severe. Any handicaps facing the plants at the present time can still be offset – at least in part – if weather conditionsattheendofthegrowthcycleturnout ideal(humidandcool,withnoexcessiverainfall). By contrast, if the drought persists or if there is a prolongedperiodofverywetweather(aswasthe case in 2007), this could cause a sharp decline in yieldpotentials.Weatherconditionsinthecoming weekswillneedtobeverycloselymonitored. Springbarleyplantingsarenowmostlycompleted intheEU,exceptinthenortherlyregions(suchas Finland)wheretheyarestilltakingplace.Generally speaking, the warm, dry weather has been favourabletoaquickcompletionofspringbarley plantings.Plantemergencehasmostlyhappened veryquicklyandtheyoungplantsnowneedwater. Maize plantings have also progressed at a rapid
  • 7. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat, barley and maize output Thelatestupdatestoourestimatescanbeconsultedonwww.strategie-grains.com.Toaccessthisserviceyouwillneedtosubscribetothe«Crop»module. 7 wheat maize Area(Mha) Yield(t/ha) Production(Mt) Area(Mha) Yield(t/ha) Production(Mt)08/09 09/10 10/11 11/12 08/09 09/10 10/11 11/12 08/09 09/10 10/11 11/12 08/09 09/10 10/11 11/12 08/09 09/10 10/11 11/12 08/09 09/10 10/11 11/12 Germany 3.21 3.21 3.30 3.31 8.09 7.82 7.04 7.45 25.95 25.12 23.24 24.63 0.52 0.46 0.45 0.48 9.81 9.75 8.79 9.63 5.10 4.53 3.99 4.64 Belgium-Lux 0.24 0.23 0.23 0.24 8.16 8.87 8.56 8.40 1.95 2.00 2.00 2.02 0.07 0.07 0.06 0.07 11.89 12.07 11.95 12.32 0.86 0.81 0.75 0.82 Denmark 0.64 0.74 0.76 0.74 7.86 8.04 6.61 7.25 5.02 5.94 5.06 5.36 Spain 1.53 1.23 1.44 1.48 3.66 2.75 3.27 3.32 5.59 3.40 4.69 4.92 0.36 0.35 0.32 0.35 8.92 8.89 9.38 9.07 3.24 3.07 3.01 3.17 France 5.06 4.73 4.92 5.04 7.29 7.66 7.24 7.14 36.90 36.23 35.64 36.01 1.76 1.74 1.55 1.52 9.13 8.90 8.75 9.08 16.04 15.50 13.57 13.80 Greece 0.20 0.21 0.17 0.18 3.02 2.33 2.10 2.48 0.60 0.50 0.36 0.44 0.24 0.19 0.15 0.16 7.61 7.76 7.49 7.64 1.85 1.47 1.12 1.20 Ireland 0.10 0.08 0.07 0.09 9.06 8.12 8.75 8.95 0.95 0.67 0.64 0.78 Italy 0.70 0.61 0.62 0.62 5.38 5.05 5.34 5.29 3.74 3.10 3.32 3.27 1.09 1.00 0.90 0.97 9.52 8.61 9.00 9.06 10.36 8.62 8.11 8.82 TheNetherl. 0.16 0.15 0.15 0.14 8.73 9.29 8.86 8.61 1.37 1.40 1.36 1.23 0.03 0.03 0.02 0.02 11.80 12.78 11.76 11.00 0.35 0.34 0.28 0.26 Portugal 0.09 0.05 0.04 0.04 2.30 1.68 1.44 1.74 0.20 0.09 0.06 0.06 0.11 0.10 0.09 0.10 6.39 6.55 7.01 6.83 0.70 0.63 0.63 0.67 UnitedKingd. 2.08 1.78 1.94 2.01 8.28 7.93 7.67 7.84 17.23 14.08 14.88 15.74 Austria 0.27 0.28 0.28 0.28 5.80 5.07 5.12 5.20 1.58 1.43 1.41 1.47 0.22 0.20 0.20 0.21 11.32 10.83 9.72 10.80 2.45 2.17 1.96 2.30 Finland 0.22 0.22 0.21 0.22 3.64 4.10 3.43 3.83 0.79 0.89 0.72 0.85 Sweden 0.36 0.37 0.40 0.40 6.13 6.10 5.42 5.92 2.20 2.28 2.18 2.35 0.00 0.00 0.00 0.00 6.49 6.40 6.25 6.25 0.01 0.01 0.01 0.01 Poland 2.28 2.35 2.41 2.42 4.07 4.11 3.77 3.92 9.27 9.64 9.08 9.49 0.32 0.27 0.30 0.33 5.81 6.23 5.76 6.14 1.84 1.71 1.73 2.02 Hungary 1.09 1.12 0.98 0.96 4.95 3.84 3.71 4.38 5.40 4.28 3.62 4.19 1.19 1.18 1.06 1.28 7.46 6.40 6.57 6.82 8.90 7.54 6.98 8.74 CzechRepublic 0.76 0.79 0.80 0.83 5.80 5.26 5.00 5.23 4.44 4.17 3.98 4.32 0.11 0.11 0.10 0.12 7.55 8.45 6.70 7.70 0.86 0.89 0.69 0.89 Slovakia 0.36 0.35 0.33 0.33 4.87 4.05 3.59 4.04 1.75 1.41 1.18 1.33 0.15 0.14 0.17 0.20 7.34 6.97 6.10 6.65 1.13 0.99 1.05 1.32 Estonia 0.11 0.11 0.12 0.13 3.18 3.01 2.71 3.01 0.34 0.34 0.32 0.39 Latvia 0.26 0.29 0.30 0.30 4.26 3.63 3.21 3.76 1.09 1.04 0.97 1.14 Lithuania 0.40 0.48 0.52 0.47 4.88 4.54 3.31 3.91 1.97 2.18 1.71 1.84 0.01 0.01 0.01 0.01 4.21 4.33 6.66 5.00 0.03 0.02 0.05 0.04 Slovenia 0.04 0.03 0.03 0.03 4.53 3.96 4.37 4.34 0.16 0.14 0.15 0.13 0.04 0.04 0.04 0.04 7.32 7.84 8.50 8.32 0.32 0.30 0.31 0.30 Cyprus/Malta 0.01 0.01 0.01 0.01 1.77 3.12 2.91 2.57 0.01 0.02 0.02 0.02 Romania 1.95 2.02 1.91 1.94 3.60 2.60 3.12 2.99 7.02 5.25 5.97 5.79 2.25 2.30 2.29 2.50 3.28 3.23 3.82 3.38 7.38 7.44 8.75 8.45 Bulgaria 1.07 1.09 1.01 1.07 4.16 3.25 3.74 3.53 4.46 3.53 3.79 3.79 0.32 0.30 0.32 0.33 3.80 4.37 6.05 4.92 1.22 1.33 1.96 1.64 EU25 20.15 19.44 20.04 20.25 6.38 6.19 5.82 6.02 128.49 120.36 116.61 121.97 6.23 5.88 5.43 5.85 8.67 8.27 8.14 8.37 54.04 48.59 44.22 49.00 EU27 23.17 22.54 22.97 23.26 6.04 5.73 5.50 5.66 139.98 129.13 126.37 131.55 8.80 8.48 8.05 8.68 7.12 6.76 6.83 6.80 62.63 57.36 54.93 59.09 barley Area(Mha) Yield(t/ha) Production(Mt) 08/09 09/10 2010/11 2011/12 08/09 09/10 2010/11 2011/12 08/09 09/10 2010/11 2011/12 wint. spri. total wint. spri. total wint. spri. total wint. spri. total wint. spri. total wint. spri. total Germany 1.96 1.88 1.30 0.35 1.65 1.23 0.35 1.57 6.10 6.54 6.56 4.84 6.20 6.34 4.83 6.01 11.97 12.29 8.55 1.69 10.25 7.78 1.67 9.45 Belgium-Lux 0.06 0.06 0.05 0.01 0.05 0.04 0.01 0.05 7.51 8.01 8.26 5.50 7.95 7.87 5.85 7.64 0.48 0.51 0.38 0.03 0.42 0.35 0.03 0.38 Denmark 0.72 0.59 0.14 0.43 0.57 0.13 0.50 0.63 4.73 5.72 5.47 5.13 5.21 5.55 5.13 5.22 3.40 3.39 0.79 2.20 2.99 0.74 2.56 3.29 Spain 3.49 3.05 0.45 2.42 2.87 0.49 2.57 3.05 3.19 2.33 2.78 2.88 2.87 2.89 3.02 3.00 11.11 7.11 1.25 6.98 8.23 1.41 7.77 9.17 France 1.80 1.88 1.16 0.42 1.58 1.09 0.44 1.54 6.76 6.84 6.51 6.07 6.39 6.48 6.23 6.41 12.17 12.88 7.56 2.54 10.10 7.10 2.77 9.87 Greece 0.12 0.12 0.11 0.11 0.11 0.11 2.85 2.33 1.98 1.98 2.40 2.40 0.33 0.28 0.22 0.22 0.25 0.25 Ireland 0.18 0.19 0.03 0.14 0.16 0.03 0.13 0.16 7.16 6.28 8.59 6.69 7.01 8.36 6.87 7.15 1.30 1.17 0.23 0.92 1.15 0.25 0.89 1.14 Italy 0.32 0.31 0.28 0.28 0.29 0.29 3.80 3.42 3.59 3.59 3.70 3.70 1.23 1.05 0.99 0.99 1.06 1.06 TheNetherl. 0.05 0.04 0.00 0.03 0.03 0.00 0.03 0.03 6.18 6.96 5.90 6.15 6.17 6.29 0.31 0.31 0.04 0.17 0.20 0.02 0.18 0.21 Portugal 0.04 0.04 0.04 0.04 0.03 0.03 2.32 1.70 1.83 1.83 2.05 2.05 0.10 0.07 0.07 0.07 0.07 0.07 UnitedKingd. 1.03 1.14 0.38 0.54 0.92 0.36 0.54 0.91 5.95 5.83 6.37 5.22 5.70 6.38 5.45 5.82 6.14 6.67 2.43 2.81 5.24 2.30 2.97 5.27 Austria 0.19 0.18 0.09 0.08 0.17 0.08 0.07 0.15 5.21 4.60 5.39 3.80 4.61 5.54 3.80 4.69 0.97 0.84 0.46 0.32 0.78 0.44 0.29 0.72 Finland 0.59 0.56 0.42 0.42 0.48 0.48 3.64 3.87 3.21 3.21 3.65 3.65 2.13 2.17 1.34 1.34 1.75 1.75 Sweden 0.40 0.36 0.02 0.29 0.31 0.01 0.33 0.34 4.23 4.69 4.69 3.98 4.03 5.47 4.28 4.33 1.67 1.68 0.08 1.14 1.23 0.08 1.41 1.49 Poland 1.21 1.16 0.21 0.91 1.12 0.17 0.93 1.10 3.00 3.44 3.92 3.00 3.17 3.84 3.11 3.22 3.62 3.98 0.81 2.73 3.54 0.65 2.89 3.54 Hungary 0.33 0.32 0.19 0.10 0.29 0.17 0.10 0.27 4.45 3.32 3.56 3.01 3.36 4.15 3.36 3.85 1.47 1.06 0.66 0.31 0.97 0.69 0.34 1.03 CzechRepublic 0.48 0.45 0.11 0.28 0.39 0.11 0.27 0.38 4.65 4.40 4.50 3.91 4.07 4.54 4.21 4.30 2.24 2.00 0.50 1.09 1.58 0.50 1.15 1.65 Slovakia 0.21 0.20 0.02 0.12 0.14 0.01 0.10 0.11 4.18 3.45 3.07 2.76 2.79 3.86 3.48 3.53 0.89 0.68 0.05 0.34 0.39 0.05 0.34 0.40 Estonia 0.14 0.14 0.00 0.10 0.10 0.00 0.12 0.12 2.56 2.68 2.41 2.41 2.60 2.60 0.35 0.38 0.00 0.25 0.25 0.00 0.30 0.30 Latvia 0.13 0.10 0.01 0.09 0.10 0.01 0.11 0.12 2.34 2.54 1.99 2.02 2.02 2.09 2.45 2.43 0.31 0.27 0.03 0.18 0.21 0.02 0.27 0.29 Lithuania 0.33 0.28 0.01 0.22 0.23 0.00 0.36 0.36 2.95 3.09 2.50 2.36 2.37 2.79 2.80 0.98 0.86 0.04 0.51 0.55 0.01 1.00 1.01 Slovenia 0.02 0.02 0.02 0.00 0.02 0.02 0.00 0.02 3.99 3.52 3.79 4.11 3.78 4.13 0.08 0.07 0.07 0.01 0.08 0.06 0.01 0.08 Cyprus/Malta 0.03 0.02 0.02 0.02 0.03 0.03 1.12 1.85 1.60 1.60 1.75 1.75 0.04 0.04 0.04 0.04 0.04 0.04 Romania 0.39 0.52 0.34 0.18 0.52 0.27 0.18 0.45 3.07 2.28 2.99 1.66 2.54 2.78 1.91 2.44 1.21 1.18 1.02 0.30 1.32 0.76 0.33 1.10 Bulgaria 0.23 0.25 0.22 0.01 0.23 0.18 0.02 0.20 3.96 3.23 3.41 2.68 3.38 3.20 2.56 3.14 0.91 0.82 0.74 0.02 0.77 0.59 0.05 0.64 EU25 13.83 13.11 4.64 6.95 11.59 4.41 7.44 11.85 4.58 4.56 5.44 3.68 4.39 5.41 3.85 4.43 63.28 59.76 25.26 25.56 50.83 23.87 28.59 52.46 EU27 14.45 13.88 5.20 7.13 12.34 4.87 7.63 12.50 4.53 4.45 5.20 3.63 4.29 5.18 3.80 4.34 65.40 61.76 27.03 25.89 52.91 25.22 28.98 54.20 Table1.1:area,yieldsandproductionforwheat,barleyandmaize
  • 8. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat, barley and maize output 8 cereals areas(Mha) chg.vs yields chg.vs production(Mt) chg.vs 2008/09 2009/10 2010/11 2011/12 2010/11 2008/09 2009/10 2010/11 2011/12 2010/11 2008/09 2009/10 2010/11 2011/12 2010/11 softwheat 23.2 22.5 23.0 23.3 1% 6.0 5.7 5.5 5.7 3% 139.9 129.1 126.4 131.5 4% barley 14.5 13.9 12.3 12.5 1% 4.5 4.5 4.3 4.3 1% 65.4 61.8 52.9 54.2 2% maize 8.8 8.5 8.0 8.7 8% 7.1 6.8 6.8 6.8 -0% 62.6 57.4 54.9 59.1 8% durum 3.2 2.9 3.0 2.7 -10% 3.2 2.9 3.0 3.0 1% 10.1 8.5 9.1 8.3 -9% rye 2.7 2.8 2.6 2.5 -2% 3.4 3.4 3.0 3.1 5% 9.3 9.6 7.8 8.0 3% othercereals 7.5 7.4 7.1 7.2 1% 3.3 3.4 3.2 3.3 2% 25.0 25.5 22.9 23.6 3% totalcereals 59.8 58.0 56.1 56.9 1% 5.2 5.0 4.9 5.0 2% 312.3 291.8 274.0 284.7 3,9% areas(kha) commercialcropyears 2008/09 2009/10 2010/11 2011/12 Totalcereals 59810 58040 56120 56940 Totaloilseeds(includedcropsgrownonset-aside) 10670 11260 11630 11620 Totalproteincrops 930 1180 1470 1360 Silage 5160 5300 5650 5790 EUset-aside&fallowland(nonfoodcropsexclud.) 5810 6300 7060 6160 ofwhichEU15set-aside 5600 3990 4350 3890 Sugarbeet 1520 1590 1590 1660 Totalareacultivated+set-aside 83900 83670 83520 83530 Table1.3:changesinareaforthemaincrops(EU27) Source:Stratégiegrains Table1.2:EuropeanUnioncerealproduction2008/09-2011/12(EU27) pace across Europe and are completed, or nearly finished,inFrance,Germany,Italy,Austria,Czech RepublicandHungary.Plantingscontinuesapace inPoland,RomaniaandBulgaria,wheretherather coolandrelativelywetspringhasslowedplanting activities. In those areas affected by drought, rates of maize plant emergence are sometimes uneven.Neverthelessitisstilltooearlytoenvisage a reduction in maize yield potentials; yields will mostly depend on weather conditions during flowering(inJuly)andduringthefinalphaseofthe development. Germany: weather has remained dry Weather update and condition of crops April was very dry in Germany and rainfall was extremely scarce (-58% compared with the seasonal average recorded 1961-1990). Very high temperatures have accompanied the drought; April 2011 is the second hottest April onrecordsince1881.Thesituationisparticularly problematic in the north and east of Germany, whichhavereceivedevenlessrainthanthecentre and south. At our time of writing (May 9), the weather forecast was not especially promising: rainfallwillcontinuetobescarceandtemperatures aresettoremainratherhighatleastuntilafterMay 15. The wheat and barley plants in Germany are still in the extension phase. However, the high temperaturesrecordedinrecentweekshavecaused plant growth rates to accelerate and the growth cycle is now around two weeks in advance of normal;theplantswillshortlybeginearformation. Damageassociatedwithstemextensionoccurring atatimeofdroughtandheatstresscaninpartbe compensatedforifconditionsareidealattheend of the growth cycle (cool and humid without excessive rainfall). By contrast, if the drought continueswhilsttheearformationandflowering takesplace,thisinitialhandicapwillbeintensified andwillgeneratesignificantlossestoyieldpotential forwhichtheplantswillnotbeabletocompensate. Ifthisturnsouttobethecase,thenumberofgrains per ear would be reduced and this component of overall yield could not offset reductions in the number of ears per m2 or low plant biomass (whicharebothlikelytobelowthisyear).Itistoo earlytodefinitivelyenvisageaverysharpfallinyield potentials,butitnowseemsimprobablethathigh wheatyieldswillbeachievedinGermanythisyear. The dry, hot weather has meant that maize plantingshaveprogressedquicklyandasofMay9, plantingactivitieswerealmostfinished. Production We have not changed our estimates for planted areasinGermany. Given the weather situation and outlook in Germany, we have decreased our yield forecasts for all the straw crops. Our yield estimates still have a significant variation potential depending onweatherconditionsinthecomingweeks.Ifthe droughtcontinues,theycouldbesubjecttosharp reduction. Softwheatyieldisreviseddownfrom7.8t/hato 7.45 t/ha. This is still much better than the very low yield obtained in 2010 (7.04 t/ha); in that yearadroughtinAprilwasfollowedbytorrential rains at harvest time, which delayed the harvest andcausedlargelossesofgrainsinthefield.Wheat productionin2011isreviseddownby1.2Mtthis monthto24.63Mt(23.24Mtin2010/11). Winterbarleyyieldisreviseddownfrom6.61t/ ha to 6.34 t/ha (6.56 t/ha in 2010/11). Spring barley yield is revised down from 4.93 t/ha to 4.83 t/ha (4.84 t/ha in 2010/11). Total barley productionisforecastdownby370ktto9.45Mt (-790ktcomparedwith2010/11). Ryeyieldisreviseddownfrom5.18t/hato4.87 t/ha(4.6t/hain2010/11);productionisrevised down from 3.08 Mt to 2.89 Mt (2.85 Mt in 2010/11). Triticale production is revised down from 2.27 Mtpreviouslyto2.18Mt(2.2Mtin2010/11). Oats production is revised down from 0.81 Mt previouslyto0.78Mt(0.6Mtin2010/11). Maize production is forecast stable compared withlastmonthat4.64Mt(3.99Mtin2010/11). Yields will mainly be impacted by weather conditions towards the end of the growth cycle (floweringtoharvest). We now estimate total grain production in Germanyat44.75Mt(43.37Mtin2010/11). Belgium/Luxembourg: harvest forecast revised down slightly As elsewhere in west Europe, Belgium has been facing a drought situation for several weeks. We havereducedouryieldforecastsslightlytoreflect this. We now estimate softwheat production at 2.02Mt(downfrom2.06Mtforecastpreviously) and barley production at 382 kt (down from 399 kt previously and 420 kt in 2010/11). Maizeproductionisforecastat818kt(750ktin 2010/11). We now estimate total grain production in BelgiumandLuxembourgat3.34Mt(compared with3.27Mtin2010/11). Denmark: rainfall scarce MarchwasdryinDenmark,andthelackofrain continued through April, with rainfall in April
  • 9. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat, barley and maize output 9 totalling just 39% of the norm for this month. Due to the fact that crop development is not as far advanced as in the other countries, the dry conditionshavenotyethadtoounfavourablean impact on the crops, especially given that some farmers took the precaution of irrigating crops to limit the drought’s impact. Nevertheless, rains are needed very urgently if a sharp fall in yield potentials,forbothwinterandspringcrops,isto be avoided. We have made small reductions this monthtoouryieldforecasts,toreflecttheprobable smaller plant biomass at flowering. If conditions areverygoodbetweennowandtheharvest,itwill be possible for the plants to compensate for this handicap. Soft wheat yield is revised down from 7.38 t/ ha to 7.25 t/ha (6.61 t/ha in 2010/11). Planted areaisrevisedupby10khato739kha(764kha in2010/11).Productionthereforedecreasesvery slightly from 5.38 Mt to 5.36 Mt (5.06 Mt in 2010/11). For barley, the adjustments to planted area compensate for the small reduction in yield and estimated production therefore remains stable at 3.3Mt(2.99Mtin2010/11),including2.56Mt ofspringbarley(2.2Mtin2010/11). WeestimatetotalgrainproductioninDenmark at9.34Mt(upfrom8.72Mtin2010/11). Spain: beneficial rains Weather update and condition of crops Last month, we highlighted that rainfall levels throughthewinterhadbeensatisfactoryinSpain, althoughtheeastofthecountryhadreceivedless rainthantherestofthecountry. The mean rainfall volume in April (a critical month in terms of yield determination) totalled 49.6 mm, very close to the average of the last 10 years. Aragon and Catalonia again received very little rainfall whereas rainfall levels were good in the main grain producing regions (Andalusia, Extremadura, Castile and Leon and Castile-la Mancha, see graphic 1.1); yield potentials are thereforemaintained.Ifrainfalllevelscontinueto be good through the next few weeks, we could increaseouryieldforecastssignificantly. At the beginning of May, the wheat plants were endingthestemextensionphasewithsomealready beginning to flower in the southern regions; the barleywasnearingtheendofitsfloweringphase. Production At this stage of plant development, the impact of the rains on potential soft wheat yield is still moderate, and we have therefore not altered our yieldforecastof4.92Mt(4.69Mtin2010/11). Durum wheat development is more advanced, partlybecauseitismostlygrowninthesouthern regions; yield potential has increased as a result of the good rainfall levels. Durum wheat yield is revisedupfrom2.3t/hato2.46t/ha(1.93t/hain 2010/11).Productionisrevisedupfrom1Mtto 1.07Mt(0.91Mtin2010/11). Barleyreapsthemaximumbenefitfromtherains and yield is revised up from 2.86 t/ha to 3 t/ha (2.87t/hain2010/11);productionisrevisedup from8.76Mtto9.17Mt(8.23Mtin2010/11). Nochangethismonthforestimatedmaizegrain productionat3.17Mt(3.01Mtin2010/11). We estimate total grain production in Spain at 19.94Mt(upfrom18.29Mtin2010/11). France: drought conditions persist Weather update and condition of crops After a very dry month in March, drought conditionscontinuedthroughApril.Thevolume of rainfall was very much lower than normal throughout France at around 75% less than the norm (recorded 1971-2000) in a good half of the country. The rainfall deficit was particularly pronounced in Normandy, Picardy, in the Paris region, part of the Centre region, Poitou- CharentesandthePaysdeLoire.Thescarcityof rainfall and the high temperatures have already led to the introduction of irrigation restrictions, notablyinPoitou-CharentesandtheParisregion. AtthebeginningofMay,therewasalittlerainfall innorthernFrance,mostlyintheformoflocalised downpours that were insufficient to bring any significant(andmuchneeded)respitetothecrops. Rainfallvolumesareforecasttoremainsmalluntil atleastMay12,whichwillcontributetoafurther intensificationofthestresslevelscurrentlyaffecting thecrops. AsofMay6,Frenchwheathadalmostreachedthe earformationphase,around10to15daysearlier thannormal.Thismeansthattheriskofdamage fromnightfrostswillbemuchhigherduringear formation and flowering, when the plants are extremely sensitive to colder temperatures. We willmonitorthispointclosely,becauseanysudden drop in temperature could impact negatively on earfertility. Meanwhile,thefactthattheentirestemextension phasetookplaceindryconditionswillmeanthat secondary tillers are much less abundant than normal and that the plants face a shortage of nitrogen.Nitrogenthatwasdistributedinthefields didnotdissolvedcorrectlyintothesoilandthusit hasnotbeenproperlyabsorbed.Plantbiomassat flowering will therefore probably be smaller than normal.Thishandicapisnotnecessarilyasetback as far as yield is concerned because if weather conditions are clement at the end of the growth cycle(mildandhumidwithoutexcessiverainfall) theplantswillbeabletocompensateatleastinpart forthisdisadvantage.However,forthisscenarioto playout,asignificantvolumeofrainwillneedto fallverysoon. Meanwhile, the dry weather in April was very favourable in terms of maize plantings. These beganatthebeginningofAprilandwerealmost finishedbythebeginningofMay,around10days earlier than normal. Maize plant emergence has happenedveryquickly. Production Ourcropareaforecaststakeaccountofthelatest estimates published by SSP and FranceAgriMer. This month, we have significantly reduced our yieldforecastsforallthestrawcropstoreflectthe Graphic1.1:rainfallvolumesinSpain(mm)inApril Source:AgenciaEstataldeMeteorologia(AEMET)
  • 10. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat, barley and maize output 10 area(kha) SSP FranceAgriMer May2011 May2011 10/11 11/12 evo. 10/11 11/12 evo. wintersoftwheat 4908 5004 2,0% na na softwheatwint.+spring 4921 5016 1,9% 4921 5018 2,0% winterbarley 1163 1094 -5,9% 1165 1096 -5,9% springbarley 419 453 8,1% 422 455 7,8% barleywint.+spring 1582 1547 -2,2% 1588 1552 -2,3% winterdurum 493 464 -5,9% na na durumwint.+spring 505 471 -6,8% 503 462 -8,2% rye 30 29 -0,7% 30 29 -1,8% winteroats 59 58 -2,0% na na oatswint.+spring 98 95 -3,8% 99 94 -5,8% triticale 382 384 0,6% 378 386 2,1% maize 1571 1563 -0,6% 1543 1520 -1,5% sorghum 52 45 -13,4% 52 45 -13,8% total cereals 9141 9150 0,1% 9113 9104 -0,1% winterrape 1459 1523 4,4% na na rapewint.+spring 1465 1527 4,2% 1457 1520 4,3% sun 695 699 0,6% 698 710 1,7% proteincrops 404 312 -22,7% na na extremelydryweatherconditions. Softwheatyieldfallsfrom7.43t/hato7.14t/ha (7.24 t/ha in 2010/11). Production is therefore revised down by almost 1.5 Mt to 36.01 Mt (35.64Mtin2010/11).Thisestimatehasafurther significantvariationpotentialthatwilldependon weatherconditionsinthecomingweeks.Ifrainfall remainsscarce,yieldpotentialscouldsufferfurther decrease; if conditions at the end of the growth cycleturnouttobeideal(relativelycoolandhumid withoutexcessiverains),yieldscouldincreasealittle. Estimated winter barley yield falls from 6.78 t/ ha to 6.48 t/ha (6.51 t/ha in 2010/11). Spring barleyyielddecreasesfrom6.47t/halastmonth to 6.23 t/ha (6.07 t/ha in 2010/11). We now forecastwinterbarleyproductionat7.1Mt,down from 7.44 Mt previously (7.56 Mt in 2010/11) and spring barley production at 2.77 Mt, down from 2.85 Mt previously (2.54 Mt in 2010/11). As in the case of soft wheat, these estimates have asignificantpotentialforvariationdependingon weatheroutcomesinthenextfewweeks. Durumwheatyieldfallsfrom5.14t/hato4.83 t/ha (5.09 t/ha in 2010/11); production is thus revised down by 140 kt to 2.19 Mt (2.55 Mt in 2010/11). Wehavereducedestimatedmaizegrainareaby70 khathismonthto1.52Mha.Thisestimatereflects thelatestforecastsfromSSPandFranceAgriMer and includes a forecast of 40 kha transfer from maize grain production to silage. This reflects the fact that fodder stocks from 2010 are low. In all probability, it will not be possible to offset this shortfall with increased hay production in 2011.Unlessmaizeyieldsareverygood,livestock farmers (especially in Brittany and the Pays de Loire)willneedtodivertsomemaizegrainfields tosilageproduction.Wewillamendthisforecast to reflect the change in maize yield potentials. Taking account of this smaller maize grain area, productionisreviseddownfrom14.44Mtto13.8 Mt(13.57Mtin2010/11). We now estimate total grain production in Franceat64.97Mt(65.12Mtin2010/11). Greece: no change TemperaturesinGreecewerelowerthannormal in April, causing a slight deceleration in crop development. Rainfall levels were satisfactory at thebeginningofMay. Nochangetoourproduction forecasts:  Softwheat:440kt(360ktin2010/11)  Barley:250kt(220ktin2010/11)  Durumwheat:1Mt(1Mtin2010/11)  Maizegrain:1.2Mt(1.12Mtin2010/11)  Totalgrainproduction:2.99Mt(2.81Mtin 2010/11). Italy: yields impacted by drought in the north AselsewhereinwestEurope,therehasbeenvery little rainfall in northern Italy. Maize plantings were completed within the ideal timeframe but thenewplantshaveemergedatvariedrates.Crop conditionthereforedependsonplantingdatesand soiltypes. The soft wheat reached flowering at the end of Aprilandthe lack of water has already impacted yield potentials for wheat and barley in the northernItalianregions. Bycontrast,therewasmorerainfallthannormal in the south and the centre during April. Yield potentials are therefore unchanged in the south and remain good in the centre, where plantings tookplaceverylate. Toreflectthissituation,wehaverevisedsoftwheat yield down from 5.38 t/ha to 5.29 t/ha (5.34 t/ hain2010/11).Softwheatproductionisrevised downfrom3.33Mtpreviouslyto3.27Mt(3.32 Mtin2010/11). Durumwheatproductionisreviseddownby10 ktto3.48Mt(3.99Mtin2010/11).Theexpected reduction in durum wheat production is much smaller because this crop is mostly grown in the centreandsouth. Barley yield is revised down from 3.76 t/ha previously to 3.7 t/ha (3.59 t/ha in 2010/11); thisgeneratesanexpectedharvestof1.06Mt(-15 kt since last month) compared with 0.99 Mt in 2010/11). Maizegrainproductionisunchangedthismonth at8.82Mt(8.11Mtin2010/11). WenowestimatetotalgrainproductioninItaly at17.3Mt(17.12Mtin2010/11).. Netherlands: wheat yield revised down slightly TheNetherlandsisalsoextremelydryonaccount ofthelackofrainfall.AtthebeginningofMay,the crops were in a satisfactory state due to existing moisture content in the soil, thanks to good rainfallvolumesthroughtheautumnandwinter. However, this indicates that the plants’ root systems do not extend very deep and that their capacitytoresistdroughtwillbelow. Intermsofdevelopment,thewheatisnowinfull extensionphase,thespringbarleyisemergingand themaizeiscurrentlybeingplanted.  Softwheatyieldisreviseddownfrom8.72t/ha to 8.61 t/ha (8.86 t/ha in 2010/11); this would generateaharvestof1.23Mt,downfrom1.25Mt estimatedpreviouslyand1.36Mtin2010/11). No change this month to our other production forecasts:  Barley:210kt(200ktin2010/11)  Maizegrain:260kt(280ktin2010/11) Wenowestimatetotalgrainproductioninthe Netherlandsat1.78Mt(1.92Mtin2010/11). Portugal: little change LiketheothercountriesofMediterraneanEurope, Portugal received abundant rainfall at the end of April and crop development was good at the Table1.4:SSPandFranceAgriMerestimatesforcrop productionsinFrance Source:SSPdated5May;FranceAgriMerdated11May2011
  • 11. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat, barley and maize output 11 beginningofMay. Maize grain plantings were taking place at this time and we have increased slightly our forecast for maize area by 10 kha to 100 kha (90 kha in 2010/11). We estimate maize grain production at 670 kt, up from 610 kt previously (630 kt in 2010/11). Nochangetoourotherharvestestimates:  Softwheat:65kt(thesameasin2010/11)  Barley:66kt(75ktin2010/11). WeestimatetotalgrainproductioninPortugalat 0.92Mt(0.88Mtin2010/11). UK: yields impacted by lack of rain Weather update and condition of crops After an unusually dry month of March, the absence of rainfall continued throughout the whole of April (rainfall averaged less than 20 mm, less than 35 % of the seasonal norm). The rainfalldeficitconcernsEnglandandWales,with the southern and eastern regions affected most severely. Wherepossible,farmershavebeenirrigatingcrops to maintain yield potentials. However, in areas oflightsoil,yieldpotentialswerealreadyreduced as of the start of May. In deeper soils, the impact hasbeenlesspronounced.Rainfallinthecoming two weeks will be critical in determining crop developmentoutcomes. At the beginning of May, the winter barley had reached the end of its extension phase (last leaf emergence) following rapid development due to thewarmconditions.Winterwheatdevelopment is also more advanced than in previous years: the earliest sown plants are already at third node emergencewhilstthelastplantssownarenowat theendoftillering. In Scotland, spring barley plantings have been completedinlinewithfarmers’plantingintentions. Production Wehavereducedouryieldforecastsforthestraw cereals. Softwheatyieldisreviseddownfrom8.01t/ha to7.84t/ha(7.67t/hain2010/11);productionis reviseddownfrom16.07Mtpreviouslyto15.74 Mt(14.88Mtin2010/11). Weestimatewinterbarleyyielddownfrom6.58t/ hapreviouslyto6.38t/ha(6.37t/hain2010/11). Winterbarleyproductionisforecastdownby70 ktto2.3Mt(2.43Mtin2010/11).Springbarley registersasmallerreductioninprojectedyieldthis month, dropping from 5.52 t/ha to 5.45 t/ha (5.22t/halastyear);productionisreviseddownby 35ktto2.97Mt(2.81Mtin2010/11). Oatyieldisalsoreviseddownfrom5.94t/hato 5.88 t/ha (5.52 t/ha in 2010/11); this comes in addition to 10 kha decline in estimated area to 115kha(125khain2010/11).Oatproductionis thereforereviseddownby80ktto680kt(685kt in2010/11). WeestimatetotalgrainproductionintheUKat 21.83Mt(20.94Mtin2010/11). Austria: dry conditions recorded Austria is also suffering from a lack of rain; the countrymostrecentlyreceivedsignificantrainsin mid-March. Since thestart ofthe winter,Austria hasonlyreceivedaround50%ofitsnormalrainfall volume.Plantstresshasbeenintensifiedbecauseof high temperatures, which remained above the seasonalaveragethroughoutApril. Despite this, the winter crops remain in good condition: yield potential has not yet suffered a negative impact. Maize plantings have been completed and crop emergence has been satisfactory. No change to our production  estimates this month:  Softwheat:1.47Mt(1.41Mtin2010/11).  Barley:720kt(780ktin2010/11)  Maizegrain:2.3Mt(1.96Mtin2010/11)  Totalgrainproduction: 5.16 Mt (4.78 Mt en2010/11). Finland: spring crop plantings have started After a very harsh winter in Finland, the snow hasnowcompletelymeltedinthesouthandthe springhasarrived.Vegetationgrowthhasresumed andtheconditionofthewintercropswasdeemed satisfactoryatthebeginningofMay. Spring crop plantings started in good time. On May6,around15%ofplantingshadalreadytaken place and the remaining area should be planted quicklythankstothedry,mildconditionsforecast forthecomingweeks. No change to our production forecasts since last month:  Softwheat:0.85Mt(0.72Mtin2010/11)  Barley:1.74Mt(1.34Mtin2010/11)  Oat:0.94Mt(0.81Mtin2010/11)  Total grain production: 3.67 Mt (up from 2.99Mtin2010/11). Sweden: spring crop plantings finished SpringcropplantingswerecompletedinSweden during the last week of April, around a week laterthannormal.RainsatthestartofAprilwere beneficial for the 50 % of fields planted by that stage, and plant emergence was good thanks to the mild temperatures. Since then, conditions have stayed dry and the state of the crops varies significantlyfromplacetoplace. No change to our production forecasts since last month:  Softwheat:2.35Mt(2.18Mtin2010/11)  Barley:1.49Mt(1.23Mtin2010/11)  Oat:0.78Mt(0.56Mtin2010/11)  Totalgrainproduction:4.94Mt(4.34Mtin 2010/11). Poland: yield potentials hit by harsh winter Weather update and condition of crops WeatherconditionsstayedcoldinPolandthrough March,butspringhasnowarrived.Temperatures weremilderthannormalthroughthelast10days of April, allowing plant development to progress rapidly and offset several days development shortfall caused by the long winter. Plant developmentwassatisfactoryatthebeginningof Maybutrainsarenowurgentlyneeded,especially in the west, in order to prevent a loss of yield potential. Thewheatplantswerestartingupwardextension at the beginning of May and farmers were just beginningtosowthemaize,althoughnighttime temperatureswerestillcold,fallingbelowfreezing inthecentreofthecountry. Production Poland’sstatisticsofficepublisheditsfirstestimates forwintercropareas;wehavetakenthesefigures intoaccount. Wehavealsoamendedouryieldestimatestoreflect our hypothesis that the minimum temperatures recordedinPolandduringthewinterwillhavehad anegativeimpactonthewintercereals. Softwheatyield is revised down from 4 t/ha to 3.92t/ha(3.77t/hain2010/11)andproduction down from 9.78 Mt to 9.49 Mt (9.08 Mt in 2010/11). Winter barley yield falls from 3.96 t/ha to 3.84 t/ha (3.92 t/ha in 2010/11). Total barley production is now estimated at 3.54 Mt, down from3.56Mtlastmonth(3.55Mtin2010/11). Rye area is revised up by 25 kha this month to 1.4 Mha (the same as in 2010/11); this offsets thesmallfallinestimatedyieldfrom2.42t/hato 2.37 t/ha (2.34 t/ha in 2010/11). Production is unchangedat3.31Mt(3.27Mtin2010/11). Oatproductionisreviseddownby15ktto1.42 Mt(1.33Mtin2010/11). No change for maize grain production this monthat2.02Mt(1.73Mtin2010/11). We now estimate total grain production in Polandat27.53Mt(26.83Mtin2010/11).
  • 12. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat, barley and maize output 12 Hungary: maize plantings completed Weather update and condition of crops Last month, we forecast that farmers’ planting intentions for spring barley would not be fully realised due to the comparatively low level of plantings completed by the end of March. In effect,thedryconditionsinAprilallowedfarmers tocompletespringbarleyplantingstothelevelof their original intentions and also meant that the totalityofmaizeplantingcouldbecompleted.At thebeginningofMay,maizeplantemergencewas satisfactory. The wheat plants were in full extension phase during the first days of May and development is judgedsatisfactory.Theonlyworryconcernsthose fieldsthatwerefloodedlastautumn,wherewheat developmentisverymixed:thisconcernsaround 80khaofwheat,locatedinareaswhereplantswere asphyxiated. Rainfall is now needed in Hungary to prevent a declineinyieldpotentials. Production We have decreased our forecast for soft wheat yield potential to reflect the negative outlook for fieldsinareashitbyflooding;productionisrevised downby35ktthismonthto4.19Mt(3.62Mtin 2010/11). Spring barley area is revised up by 10 kha to 100 kha (the same as in 2010/11). Total barley productionisrevisedupfrom1Mtlastmonthto 1.03Mt(0.97Mtin2010/11). No change for maize grain production this monthat8.74Mt(6.98Mtin2010/11). WeestimatetotalgrainproductioninHungary at14.68Mt(upfrom12.29Mtin2010/11). Czech Republic: beneficial rains at the end of April Weather conditions through April were dry and hotintheCzechRepublic.Farmerswereableto completespringbarleyplantingswithintheideal plantingwindowandindeedmaizegrainplantings werealmostfinishedbythebeginningofMay. Although insufficient to meet requirements, the CzechRepublicreceivedsomerainfallattheend ofApril,whichbroughtsomerespitetothecrops. No change this month to estimated soft wheat productionat4.32Mt(3.98Mtin2010/11). Spring barley production is revised down by 10 khathismonthto270kha(280khain2010/11). Totalbarleyproductionisnowestimatedat1.65 Mt, down from 1.7 Mt previously (1.58 Mt in 2010/11). Maizegrainproductionisrevisedupby30ktthis monthto0.89Mt(0.69Mtin2010/11). We estimate total grain production in Czech Republic at 7.51 Mt (up from 6.88 Mt in 2010/11). Slovakia: small increase for maize Rainfall levels have also been insufficient in Slovakia during the last few weeks; the last significantrainfallwasinmid-March.Attheendof April,cropdevelopmentwasneverthelessjudged satisfactory. The wheat is in full extension phase andrainisnowneededurgentlyifyieldpotentials aretobemaintained. Farmers were able to complete spring barley plantings within the ideal planting window and maizeplantingsarenowalmostfinished. No change this month to estimated soft wheat productionat1.33Mt(1.19Mtin2010/11). Springbarleyproductionisreviseddownby10 khato100kha(125khain2010/11);totalbarley productionisforecastat400kt,downfrom440kt lastmonth(390ktin2010/11). Thischangebenefitsprojectedmaizegrainarea, which increases 10 kha to 200 kha (170 kha in 2010/11).Maizeproductionisnowestimatedat 1.32Mt,upfrom1.26Mtpreviously(1.05Mtin 2010/11). WeestimatetotalgrainproductioninSlovakiaat 3.23Mt(upfrom2.81Mtin2010/11). Lithuania: very significant winterkill Lastmonth,weindicatedthatthewintercropsin Lithuaniahadsufferedsubstantialdamageduring thewinterbutthatitwastooearlytoestimatethe fullextent.Sincethen,Lithuania’sstatisticsofficehas published its estimate of crop losses to winterkill, whichisindeedveryhighthisyear.Inresponseto themilderwinterconditionsofrecentyears,during thelastthreeyearsfarmersinLithuaniahaveopted toplantincreasingwintercropareasintheautumn inordertoobtainbetteryields.However,thisyear the strategy of planting winter rather than spring cropshasnotpaidoff. Wehaveadoptedtheofficialestimatesforwinter losses,whichgeneratesasignificanttransferofcrop areasintospringgrainproduction,forwhichyields arelower.Overall,thechangesmeanthatourcrop areaforecastsarenowsimilartothoseof4or5years ago. Winter wheat area is revised down by 100 kha this month to 260 kha (370 kha in 2010/11); spring wheat area is revised up by 160 kha to 210kha(150khain2010/11).Totalsoftwheat production therefore falls by 320 kt to 1.84 Mt (1.71Mtin2010/11). Winter barley has all but disappeared and therefore spring barley area rises sharply by 125 khato360kha(220khain2010/11).Totalbarley productionisnowestimatedat1Mt,upfrom0.7 Mtpreviously(0.55Mtin2010/11). We now estimate total grain production in Lithuania at 3.45 Mt (up from 2.77 Mt in 2010/11). Romania: maize area revised up slightly RomaniareceivedplentyofrainfallinApril;atthe beginningofMay,allthecropswereinasatisfactory condition. However, temperatures have been cooler than normal and plant development was aroundaweekbehindscheduleatthebeginning ofMay. Thealterationtosoftwheatproductionin2010 impacts yield for2011; it rises from 2.94 t/ha to 2.99t/ha;productiongains90kt,risingto5.79Mt (5.97Mtin2010/11). Springbarleyareaisreviseddownfrom195kha to 175 kha (180 kha in 2010/11). Total barley productionisnowestimatedat1.1Mt,downfrom 1.14Mtlastmonth(1.32Mtin2010/11). Maize grain area benefits from this adjustment, rising from 2.47 Mha to 2.5 Mha (2.29 Mha in 2010/11).Maizegrainproductionisrevisedupby 80ktto8.45Mt(8.75Mtin2010/11). We now estimate total grain production in Romania at 15.84 Mt (down from 16.57 Mt in 2010/11). Bulgaria: development shortfall Temperatures were below the seasonal norm in Bulgaria during April. This slowed winter crop development,whichisnowalmost10daysbehind schedulecomparedwithanormalyearinthewest of the country and 15 to 20 days behind in the east.Wateravailabilitywasnotacauseforconcern duringApril. Therateofmaizeplantingsalsoslowedwhilethe ideal window for plantings closes around May 10. We are currently working on the basis that farmerswillfulfiltheirplantingintentionsgiventhe attractivenessofthiscropinfinancialterms. Nochangetoourproduction estimates:  Softwheat:3.79Mt(thesameas2010/11)  Barley: 0.64Mt(0.77Mtin2010/11)  Maizegrain:1.64Mt(1.96Mtin2010/11)  Totalgrainproduction:6.25Mt(6.71Mtin 2010/11).
  • 13. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat, barley and maize output 13 2008/09 2009/10 2010/11 (Mt) Total output % milling Milling output Total output % milling Milling output Total output % milling Milling output Germany 25.95 91% 23.59 25.12 92% 23.04 23.24 43% 9.99 Belgium-Lux 1.95 20% 0.39 2.00 18% 0.36 2.00 19% 0.38 Denmark 5.02 17% 0.85 5.94 15% 0.89 5.06 10% 0.51 Spain 5.59 93% 5.19 3.40 95% 3.23 4.69 93% 4.36 France 36.90 90% 33.21 36.23 82% 29.71 35.64 89% 31.72 Greece 0.53 50% 0.26 0.50 30% 0.15 0.36 30% 0.11 Ireland 0.95 10% 0.10 0.67 10% 0.07 0.64 15% 0.10 Italy 3.74 80% 2.99 3.10 75% 2.33 3.32 75% 2.49 TheNetherl. 1.37 20% 0.27 1.40 18% 0.25 1.36 19% 0.26 Portugal 0.20 95% 0.19 0.09 95% 0.08 0.06 95% 0.06 UnitedKingd. 17.23 25% 4.31 14.08 30% 4.22 14.88 29% 4.31 Austria 1.58 50% 0.79 1.43 60% 0.86 1.41 70% 0.99 Finland 0.79 20% 0.16 0.89 30% 0.27 0.72 67% 0.49 Sweden 2.20 15% 0.33 2.28 15% 0.34 2.18 15% 0.33 Poland 9.27 80% 7.42 9.64 80% 7.71 9.08 45% 4.08 Hungary 5.40 60% 3.24 4.28 60% 2.57 3.62 50% 1.81 CzechRepublic 4.44 91% 4.04 4.17 50% 2.09 3.98 50% 1.99 Slovakia 1.75 80% 1.40 1.41 70% 0.99 1.18 50% 0.59 Estonia 0.34 70% 0.24 0.34 90% 0.31 0.32 70% 0.23 Latvia 1.09 80% 0.87 1.04 97% 1.01 0.97 70% 0.68 Lithuania 1.97 80% 1.58 2.18 95% 2.07 1.71 70% 1.20 Slovenia 0.16 50% 0.08 0.14 50% 0.07 0.15 50% 0.08 Cyprus/Malta 0.01 34% 0.00 0.02 35% 0.01 0.02 20% 0.00 Romania 7.02 35% 2.46 5.25 30% 1.57 5.97 20% 1.19 Bulgaria 4.46 34% 1.52 3.53 35% 1.23 3.79 20% 0.76 EU 27 139.90 68% 95.48 129.13 66% 85.43 126.37 54% 68.70 Tableau1.5:estimatesforpercentageoftotalwheatproductionmeeting criteriaformillingineachEUcountry(cropyears2008/09,2009/10and2010/11) Source:Stratégiegrains Crop year 2010/11 Wheatproductionrevisedup Belgium/Luxembourg: final production estimates published Belgium’s statistics office published its final productionfiguresforthe2010harvest.Wehave adoptedthesefigures. The2010harvestsinBelgiumandLuxembourg nowtotal:  Softwheat:2Mt,upfrom1.92Mtpreviously (2Mtin2009/10)  Barley:416kt,upfrom400ktpreviously(507 ktin2009/10)  Maize:748kt,upfrom671ktpreviously(810 ktin2009/10). Latvia: new official production estimates Latvia’sstatisticsofficepublishednewproduction estimates,whichwehaveadopted. Softwheatrisessharplyby70ktto0.97Mt(1.04 Mtin2009/10). Barleyproductionfallsby10ktto210kt(270kt in2009/10). Romania: wheat production revised up To reflect wheat export volumes shipped by Romaniain2010/11,wehaveincreasedestimated soft wheat production. Yield is revised up from 2.99 t/ha previously to 3.12 t/ha (2.6 t/ha in 2009/10)andproductionnowtotals5.97Mt,up from5.72Mtlastmonth(5.25Mtin2009/10).
  • 14. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 cereal consumption in the animal feed sector Cereal consumption in the animal feed sector 14 Mt 2008/2009 2009/2010 2010/2011 2011/2012 Tot. cat. pig pou Tot. cat. pig pou Total cat. pig pou Total cat. pig pou Apr11 May11 Apr11 May11 Germany 20.4 6.2 9.0 5.3 20.4 6.0 9.0 5.4 20.6 21.0 6.3 9.3 5.5 20.7 21.1 6.3 9.3 5.5 Belg.-Lux 6.4 1.3 3.8 1.4 6.6 1.2 3.8 1.5 6.6 6.6 1.3 3.8 1.5 6.6 6.6 1.3 3.8 1.5 Denmark 4.6 1.0 3.0 0.6 4.2 0.9 2.8 0.5 4.3 4.3 0.9 2.8 0.5 4.2 4.2 0.9 2.8 0.5 Spain 17.8 3.8 9.6 4.5 17.3 3.7 9.2 4.4 17.2 17.2 3.8 9.0 4.4 17.3 17.3 3.8 9.0 4.5 France 19.8 5.1 6.1 8.6 19.2 4.9 5.8 8.5 19.5 19.5 5.2 5.7 8.7 19.5 19.5 5.3 5.5 8.7 Greece 1.9 0.5 0.7 0.7 1.9 0.5 0.7 0.7 2.0 2.0 0.5 0.8 0.7 2.0 2.0 0.5 0.8 0.7 Ireland 3.0 1.9 0.6 0.5 3.0 1.9 0.6 0.5 3.1 3.1 2.0 0.6 0.5 3.1 3.1 2.0 0.6 0.5 Italy 12.3 3.7 3.2 5.4 12.2 3.5 3.2 5.5 12.1 12.1 3.4 3.2 5.5 12.2 12.2 3.5 3.2 5.6 Netherl. 13.1 3.4 6.0 3.7 12.9 3.4 5.9 3.6 13.0 12.9 3.4 5.9 3.6 12.9 12.9 3.4 5.8 3.6 Portugal 3.2 0.8 1.0 1.4 3.1 0.8 0.9 1.4 3.1 3.1 0.8 0.9 1.4 3.1 3.1 0.8 0.9 1.4 U.King. 12.4 4.7 1.5 6.2 12.9 4.9 1.6 6.4 13.2 13.1 5.0 1.6 6.5 13.3 13.2 4.9 1.7 6.5 Austria 1.1 0.4 0.2 0.4 1.1 0.4 0.2 0.4 1.1 1.1 0.4 0.2 0.5 1.1 1.1 0.4 0.2 0.5 Finland 1.3 0.6 0.4 0.3 1.2 0.6 0.3 0.3 1.2 1.2 0.6 0.3 0.3 1.2 1.2 0.6 0.3 0.3 Sweden 1.9 1.0 0.4 0.5 1.8 0.9 0.4 0.5 1.8 1.8 0.9 0.4 0.5 1.8 1.8 0.9 0.4 0.6 Poland 6.8 0.7 1.6 4.5 7.1 0.7 1.5 5.0 7.2 7.2 0.7 1.5 5.0 7.1 7.1 0.7 1.5 4.8 Hungary 3.8 0.5 1.6 1.7 3.7 0.5 1.5 1.7 3.6 3.6 0.5 1.4 1.7 3.6 3.6 0.5 1.4 1.7 CzechRep. 2.6 0.5 1.0 1.1 2.5 0.5 0.9 1.0 2.5 2.5 0.5 0.9 1.0 2.4 2.4 0.5 0.9 1.0 Slovakia 0.7 0.2 0.2 0.3 0.6 0.2 0.2 0.2 0.6 0.6 0.2 0.2 0.2 0.6 0.6 0.2 0.2 0.3 Estonia 0.2 0.0 0.1 0.0 0.2 0.0 0.1 0.0 0.2 0.2 0.0 0.1 0.0 0.2 0.2 0.0 0.2 0.0 Latvia 0.2 0.0 0.1 0.0 0.2 0.0 0.1 0.0 0.2 0.2 0.0 0.1 0.0 0.2 0.2 0.0 0.1 0.0 Lithuania 0.4 0.1 0.1 0.2 0.4 0.1 0.1 0.2 0.4 0.4 0.1 0.1 0.2 0.4 0.4 0.1 0.1 0.2 Slovenia 0.5 0.1 0.1 0.2 0.5 0.1 0.1 0.3 0.5 0.5 0.1 0.1 0.3 0.5 0.5 0.1 0.1 0.3 Cyprus/Malta 0.2 0.1 0.0 0.1 0.2 0.1 0.0 0.1 0.2 0.2 0.1 0.0 0.1 0.2 0.2 0.1 0.0 0.1 Romania 2.8 0.1 1.2 1.5 2.8 0.1 1.1 1.5 2.7 2.7 0.1 1.1 1.5 2.7 2.7 0.1 1.1 1.5 Bulgaria 0.7 0.0 0.2 0.4 0.6 0.0 0.2 0.4 0.6 0.6 0.0 0.2 0.4 0.6 0.6 0.0 0.2 0.4 EU 27 138.2 37.0 51.7 49.5 136.7 36.0 50.4 50.2 137.5 137.9 36.7 50.4 50.7 137.4 137.8 37.0 50.1 50.8 Crop year 2010/11 Industrial feed output is revised up by 0.4 Mt this month to 137.9 Mt, reflecting the inclusion of the latest data from Germany in our forecasting. Estimated demand for cereals is revised up by 1 Mt this month but remains forecast significantly lower than in 2009/10 (-5.4 Mt). Crop year 2011/12 Estimated feed output in 2011/12 increases in line with this month’s changes for 2010/11. It is set to remain at a similar level to 2010/11.By contrast, estimated grain usage in animal feeds is forecast to decline in line with this month’s reductions to harvest estimates and hence availabilities for on-farm grain usage. The downward correction concerns wheat and maize. EU27 Industrial feed production Feed production revised up Weestimateindustrialfeedoutputin2010/11 at 137.9 Mt (136.7 Mt in 2009/10); our es- timate has increased by 0.4 Mt this month, mainly to reflect a higher production forecast for Germany. The increase relates to pig feed (+0.26Mtto50.4MtintheEU,thesameasin 2009/10)andpoultryfeed(+0.13Mtto50.7 Mtcomparedwith50.2Mtin2009/10). Industrialfeedoutputin2011/12isestimated at 137.8 Mt, close to the level of 2010/11 (up from137.4Mtlastmonth);thiscomprises37 Mt of cattle feed (no change compared with lastmonth),50.1Mtofpigfeed(upfrom49.8 Mt last month) and 50.8 Mt of poultry feed (50.7Mtlastmonth). Situation in each country Germany: feed production estimated up Germany’s agriculture ministry (BMELV) has published industrial feed output figures for January 2011 and has made sharp upward corrections to its figures for July through December 2010. We have therefore increased ourforecastforcattlefeedoutputinGermany by 70 kt to 6.3 Mt (6 Mt in 2009/10), pig feed output by 0.23 Mt to 9.3 Mt (9 Mt in 2009/10)andpoultryfeedoutputby0.17Mt to 5.5 Mt (5.4 Mt in 2009/10). Combined productionof thethreefeed types is now esti- matedat21Mt(upfrom20.6Mtlastmonth and20.4Mtin2009/10).Totalfeedoutputin 2011/12 also increases to 21.1 Mt (compared with 20.7 Mt previously) comprising 6.3 Mt ofcattlefeed,9.3Mtofpigfeedand5.5Mtof poultryfeed. Table2.1:changesinEU27industrialcompoundfeedproductionbycountry
  • 15. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 cereal consumption in the animal feed sector 15 0,9 1,1 1,3 1,5 1,7 1,9 2,1 2,3 2,5 2,7 2,9 3,1 3,3 3,5 July Sept. Nove. Janu. Marc. May 2007/08 2009/10 2008/09 2010/11 2011/12 140 160 180 200 220 240 260 280 300 320 340 360 380 140 180 220 260 300 340 380 420 460 500 540 580 Jan-87 Jun-88 Nov-89 Apr-91 Sep-92 Feb-94 Jul-95 Dec-96 May-98 Oct-99 Mar-01 Aug-02 Jan-04 Jun-05 Nov-06 Apr-08 Sep-09 Feb-11 Jul-12 € / ton $ / ton 48% soymeal, CIF Rotterdam $/t 48% soymeal, French ports (€/t) May-Jun2011 Jul-Sep2011 Oct-Dec2011 Beg.Apr (€/t) Beg.May (€/t) %chge Beg.Apr (€/t) Beg.May (€/t) %chge Beg.Apr (€/t) Beg.May (€/t) %chge feedpeas 242 247 +2% 228 250 +10% 231 250 +8% rapemeal 198 203 +3% 193 201 +4% 195 200 +3% sunmeal(French) 168 153 -9% 170 158 -7% 166 156 -6% soyameal 330 307 -7% 313 310 -1% 322 312 -3% rapeseeds 478 461 -4% 458 459 +0% 459 458 -0% sunseeds na na na na na na wheatbrans 163 138 -15% 160 150 -6% 155 138 -11% beetpulp 225 225 +0% 216 230 +6% 188 230 +22% fishmeal 1330 1240 -7% 1330 1240 -7% 1330 1240 -7% groundnutmeal na na na na na na vegetableoil 937 922 -2% 937 927 -1% 937 934 -0% wheat 248 253 +2% 209 231 +11% 212 234 +10% barley 202 212 +5% 189 210 +11% 192 213 +11% maize 229 247 +8% 232 250 +8% 204 221 +8% tapioca65 na na na na na na citrus 225 227 +1% 225 227 +1% 200 231 +16% CGF 204 200 -2% 200 179 -11% 180 182 +1% molasses 187 187 +0% 187 187 +0% 187 187 +0% Graphic2.1:soymealprices Graphic2.2:soya/wheatpriceratioinFrance UK: cattle and poultry feed produc- tion estimated down DEFRAhaspublishedindustrialfeedproduc- tiondataforFebruary2011intheUK,which we have incorporated into our forecasting. Projected cattle feed output in 2010/11 falls 50 kt to 5 Mt (4.9 Mt in 2009/10) and poul- tryfeedproduction70ktto6.5Mt(6.4Mtin 2009/10); no change for pig feed production at1.6Mt(thesameas2009/10). Breakdown of raw material consumption in animal feeds in 2011/12 Demand for the main cereals revised down since last month to reflect lower har- vest forecasts Demandforwheatandmaizeinanimalfeedsis reviseddownsharplythismonth(byaround1 Mtforbothcereals),whilstestimateddemand forbarleyremainsclosetolastmonth’sforecast. The main change in the case of wheat relates toon-farmbarleyusageinFranceandBritain; demand for wheat in industrial feeds remains close to the level forecast last month. The re- duction in barley usage in on-farm feeds is ex- plained by this month’s reduction to harvest forecastsinFranceandBritain. Inthecaseofmaize,thereductionconcernsde- mandformaizeinon-farmfeedsinGermany, France (lower harvest forecasts) and Britain (reduction in quantity of maize purchased on the market for use in on-farm animal feeds, reflectingprojecteddeclineinUKmaizeavail- abilities); demand for maize is also revised down in industrial feeds in Germany and the Benelux. Demandforwheatandmaizeinanimalfeeds isstillforecasthigherthanin2010/11,butthe growthissettobelesssharpthanweforecasta monthago. Weestimatetotalgrainusageinanimalfeedsat 156.8Mt,downby1.6Mtsincelastmonth;it isnowsettobe0.9Mtlowerthanthevolume usedin2010/11. By contrast, demand for oilmeals is still set to be greater than in 2010/11 because the protein-rich commodities are set to be more competitivethantheenergy-richcommodities in 2011/12 whilst the overall volume of com- moditiesusedintheanimalfeedsectorissetto remainthesameasin2010/11. France: small growth for maize Estimatemaizeusagehasrisenslightlysincelast month. The old crop maize price for the first months of 2011/12 is now close the level at which maize becomes attractive for inclusion inpigfeeds. We estimate grain usage in French industrial Table2.2:factorydeliveredpricesforthemainrawmaterials (deliveredBrittany, €/t,wholeprices)
  • 16. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 cereal consumption in the animal feed sector 16 Avr2011 May2011 change Jul2011 5/4/11 5/5/11 5/5/11 €/t €/t €/t Span./orthirdcountrymaizefactorydelivered 252 242 96% 252 Frenchmaizefactorydelivered 249 246 99% 251 Spanish/EUbarleyfactorydelivered 252 220 87% 200 Span.wheatfactorydelivered Import.wheatfactorydeliv. 252 250 99% 222 US/Spanish/Frenchsorghum 240 242 101% 240 tapioca cornglutenfeed soymeal44% 300 306 102% 300 feedsin2011/12at:  4.7 Mtforwheat(nochange)  1.6 Mtforbarley(nochange)  3.4 Mtformaize(lastmonth:3.3 Mt). July-September 2011 Barleyremainspresentincattlefeed,although projected demand in this period declines in favour of wheat inclusions. Wheat remains the dominant ingredient in pig feeds, but the maizepriceforthisperiodisclosetothelevelat whichmaizewillstartattractingdemand(con- trarytothebarleyprice,whichwouldneedto drop by 20 €/t to be competitive enough for inclusioninthisfeedtype). October-December 2011 Contrarytothesituationlastmonth,feedpeas are no longer competitive for inclusion in pig feeds; this follows an increase in the pea price andadeclineinthesoymealprice. Feedpeainclusionsinpigfeedsthereforefalls, with demand share transferring to soya and maize. Spain: reduction for barley Little change this month to projected feed composition. Wheat usage remains high in pig and cattle feedforthefirstmonthsofthecropyear,prior to the arrival of new crop maize; thereafter wheat is absent from the feeds (except meat poultryfeeds). We estimate grain usage in Spanish industrial feedsin2011/12at:  4.4Mtforwheat(nochange)  4.0Mtforbarley(lastmonth:4.2Mt)  4.3 Mtformaize(nochange). July-September 2011 Nochangesincelastmonth.Allthethreemain cereals(wheat,barleyandmaize)arecompeti- tive in cattle and pig feeds; maize dominates in layer hen feeds and wheat in meat poultry feeds. October-December 2011 Projectedbarleyusagedeclinesinpoultryfeeds withdemandtransferringtosorghum. Thereislittlechangetotheotherfeedtypesfor this period: maize usage remains high in pig, cattle and layer hen feeds. Wheat is sidelined intomeatpoultryfeedonly. Netherlands: reductions for barley and maize with demand share transferred to wheat WeestimatetotaldemandforcerealsinDutch animalfeedsatthesamelevelaslastmonth(6.5 Mt); within this total, wheat gains demand shareduetoitsimprovedcompetitiveposition forthefirstmonthsofcropyear2011/12. We estimate grain usage in Dutch industrial feedsat:  2.9 Mtforwheat(lastmonth:2.7 Mt)  1.4 Mtforbarley(lastmonth:1.5 Mt)  2.3 Mtformaize(lastmonth:2.4 Mt). July-September 2011 Wheat’s demand share rises sharply against maize in pig feeds, and against barley in layer hen feeds. Projected barley usage declines in cattle feed against substitution commodities (citrus). October-December 2011 Barley loses demand share in pig feeds with demand transferring to maize, millfeeds and oilmeals. Breakdown of raw material consumption in animal feeds in 2010/11 Small increase in demand for the main cereals Combined demand for wheat, barley and maizeisnowestimatedat136 Mt(lastmonth: 135.3). Demandforallthreecerealshasincreased. In the case of wheat, the growth concerns Germany, Spain, France (usage in industrial feeds revised up) and Denmark (on-farm feeds).Inthecasesofbarleyandmaize,thein- creasesconcernFranceandGermanyonly. Despite this increase, grain usage in animal feeds in 2010/11 remains forecast sharply down on the level of 2009/10 (-5.4 Mt for all cerealscombined). Total demand for oilmeals is revised down from53.3Mtlastmonthto52.4Mt,although itisstillforecasthigherthanin2009/10(51.4 Mt).Thereductioncomparedwithlastmonth relates mainly to soymeal, projected demand forwhichisestimatedat32.5Mt,downfrom 33.2Mtlastmonth(30Mtin2009/10).This reductionismadetotieinwiththelatestnew supplystatistics. France: wheat, barley and maize usage estimated up Afterlastmonth’sreduction,thismonthseesa riseinprojectedgrainusage(wheat,barleyand maize)inanimalfeedsfrom9.6Mtlastmonth to9.8Mt. We estimate grain usage in French industrial feedsat:  4.3 Mtforwheat(lastmonth:4.2 Mt)  2.0 Mtforbarley(lastmonth:1.9 Mt)  3.5 Mtformaize(lastmonth:3.4Mt). January-March 2011 Wehaveincreasedestimatedmaizeusageinthe feedstoreflectprovisionaldataforgrainusage byindustrialfeedmanufacturersforMarch1 . April-June 2011 The barley and maize prices have increased since last month. Therefore wheat+enzyme basedmeatpoultryfeedsmovetoamorecom- petitive position against maize-based feeds. Meanwhile wheat and barley make gains in cattle feeds against substitution commodities (cornglutenfeed,alfalfa)andmaize. Spain: small reduction for barley and gain for wheat Projected barley usage is in decline with de- mand share transferring to wheat in the last weeksofcropyear2010/11. We estimate grain usage in Spanish industrial 1 Source :FranceAgriMer Table2.3:factorydeliveredpricesinCatalonia,Spain(€/t)
  • 17. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 cereal consumption in the animal feed sector 17 2007/08 2008/09 2009/10 2010/11 2011/12 % Mt % Mt % Mt % Mt % Mt cereals 71% 161.3 73% 166.4 73% 163.1 72% 157.7 71% 156.8 ofwhich wheat 21% 48.1 24% 54.4 24% 54.4 22% 49.4 23% 50.4 maize 22% 50.7 21% 48.7 20% 44.4 21% 45.8 21% 47.1 barley 17% 38.2 18% 41.7 19% 41.7 19% 40.8 18% 39.1 rye 1% 2.9 2% 4.1 2% 5.0 2% 3.4 2% 3.4 sorghum 3% 5.8 0% 0.4 0% 0.1 0% 1.0 0% 0.3 others 7% 15.8 7% 17.1 8% 17.5 8% 17.3 7% 16.5 peas 0% 1.1 0% 1.0 1% 1.2 1% 1.8 1% 1.5 wholeoilseeds 1% 1.6 1% 1.8 1% 1.4 0% 1.0 0% 1.0 cornglutenfeed 1% 2.9 1% 2.6 1% 2.6 1% 2.9 1% 2.7 meals 25% 55.4 23% 53.9 23% 51.4 24% 52.4 24% 53.0 ofwhichsoya 16% 37.2 15% 33.5 13% 30.0 15% 32.5 15% 32.2 rape 5% 10.3 5% 11.0 5% 12.2 5% 11.9 6% 12.4 sun 2% 3.9 2% 5.5 2% 5.3 2% 4.5 2% 5.1 corngerm 0% 0.3 0% 0.3 0% 0.3 0% 0.3 0% 0.3 groundnut 0% 0.1 0% 0.0 0% 0.1 0% 0.2 0% 0.1 cotton 0% 0.2 0% 0.2 0% 0.2 0% 0.2 0% 0.2 palmkernel 1% 2.5 1% 2.4 1% 2.2 1% 1.9 1% 1.9 lin 0% 0.2 0% 0.3 0% 0.3 0% 0.3 0% 0.3 fish 0% 0.8 0% 0.7 0% 0.7 0% 0.6 0% 0.6 tapioca 1% 1.4 0% 0.5 0% 0.0 0% 0.0 0% 0.0 brewingwastes 0% 0.5 0% 0.5 0% 0.5 0% 0.5 0% 0.5 citruspulpandDDGS 1% 1.8 1% 2.6 2% 3.5 2% 4.2 2% 4.8 total of the above materials 226.2 229.4 223.7 220.5 220.4 feedsat:  3.90 Mtforwheat(lastmonth:3.85Mt)  4.46 Mtforbarley(lastmonth:4.50Mt)  4.44 Mtformaize(lastmonth:4.46Mt). April-June 2011 Wheat usage rises at the expense of barley in poultryfeeds. Compared with last month, the wheat price hasrisenby2€/t,thebarleypriceby4€/tand themaizepriceby10€/t. Netherlands: barley usage re- vised down Estimateddemandforthecerealshasdecreased since last month to 6.6 Mt (wheat, barley and maize combined) from 6.7 Mt last month. Thereductionconcernsbarleyusageinthelast monthsofcropyear2010/11. We estimate grain usage in Dutch industrial feedsin2010/11at:  2.5 Mtforwheat(nochange)  1.8 Mtforbarley(lastmonth:1.9 Mt)  2.3 Mtformaize(nochange). April-June 2011 Demand for barley, and to a lesser extent de- mandformaize,isindeclinethroughthefinal quarterof2010/11,withdemandtransferring to imported substitution commodities (pulps andsoyahusks). Germany: wheat usage in ani- mal feeds revised up We have increased estimated wheat usage in German animal feeds to reflect statistics for grain usage in the industrial feed sector and consumption data to January 2011. It rises to from3.4Mtlastmonthto4.3Mt. Table2.4:tonnageofthemainrawmaterialsusedinindustrialfeeds andon-farm(EU27)
  • 18. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 cereal consumption in the animal feed sector 18 Wheat Barley Maize Total 09/10 2010/11 2011/12 09/10 2010/11 2011/12 09/10 2010/11 2011/12 09/10 10/11 11/12 CO OF CO OF CO OF CO OF CO OF CO OF Germany 9.5 10.5 4.3 6.3 9.7 4.1 5.6 7.8 7.7 2.2 5.5 7.5 2.1 5.3 4.3 4.1 1.5 2.6 4.5 1.8 2.7 21.6 22.4 21.7 Belgium-Lux 1.9 1.6 1.4 0.2 1.7 1.5 0.2 0.9 0.9 0.6 0.3 0.8 0.5 0.3 1.1 1.1 0.7 0.4 1.1 0.5 0.6 3.8 3.5 3.6 Denmark 3.9 3.7 1.4 2.3 3.7 1.4 2.3 2.3 2.6 1.2 1.4 2.4 1.1 1.4 0.1 0.1 0.1 0.0 0.1 0.1 0.0 6.2 6.4 6.3 Spain 6.6 5.1 3.9 1.2 5.7 4.4 1.3 9.0 8.3 4.5 3.9 8.4 4.0 4.3 5.6 5.6 4.4 1.1 6.1 4.3 1.8 21.2 19.0 20.2 France 9.1 7.2 4.3 2.9 8.1 4.7 3.4 4.6 4.3 2.0 2.3 3.7 1.6 2.1 5.2 5.9 3.5 2.4 5.8 3.4 2.3 19.0 17.3 17.5 Greece 0.3 0.1 0.3 0.4 0.4 0.4 1.7 1.6 1.7 2.3 2.1 2.4 Ireland 0.7 0.5 0.2 0.3 0.7 0.4 0.3 1.2 1.2 0.9 0.3 1.1 0.8 0.3 0.4 0.4 0.4 0.0 0.4 0.4 0.0 2.3 2.1 2.2 Italy 2.2 2.1 1.5 0.6 1.9 1.4 0.4 1.7 1.7 1.6 0.2 1.7 1.5 0.2 9.6 9.4 7.6 1.7 9.6 7.6 2.0 13.4 13.2 13.1 TheNetherl. 3.0 2.5 2.9 1.8 1.8 1.4 2.0 2.3 2.3 6.8 6.6 6.5 Portugal 0.6 0.2 0.3 0.3 0.4 0.4 1.7 1.7 1.7 2.6 2.3 2.4 UnitedK. 6.5 6.4 4.4 2.0 6.4 4.3 2.1 3.5 3.2 0.9 2.2 3.0 0.8 2.2 0.5 0.5 0.2 0.2 0.5 0.2 0.2 10.6 10.1 9.9 Austria 0.3 0.2 0.1 0.1 0.2 0.1 0.1 0.6 0.6 0.2 0.5 0.6 0.1 0.4 1.8 1.7 0.3 1.3 1.8 0.3 1.4 2.7 2.6 2.6 Finland 0.5 0.4 0.2 0.2 0.3 0.1 0.2 1.0 1.3 0.3 1.1 1.4 0.3 1.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 1.5 1.7 1.6 Sweden 0.7 0.8 0.5 0.3 0.7 0.5 0.2 1.0 0.9 0.2 0.7 0.9 0.2 0.8 0.0 0.0 0.0 0.0 0.0 0.0 0.0 1.8 1.7 1.7 Poland 3.6 3.1 3.1 2.6 2.5 2.5 1.5 1.4 1.6 7.6 7.0 7.2 Hungary 1.5 1.2 1.2 0.3 0.4 0.5 2.4 2.4 2.3 4.2 4.0 4.0 CzechRep. 1.5 1.5 1.5 1.0 0.9 0.8 0.4 0.4 0.5 2.8 2.8 2.8 Slovakia 0.7 0.7 0.6 0.3 0.2 0.1 0.2 0.3 0.4 1.1 1.2 1.2 Estonia 0.1 0.2 0.2 0.2 0.1 0.2 0.0 0.0 0.0 0.4 0.3 0.4 Latvia 0.1 0.2 0.0 0.2 0.2 0.0 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.3 0.4 0.3 Lithuania 0.3 0.4 0.0 0.4 0.3 0.0 0.2 0.5 0.4 0.1 0.3 0.6 0.1 0.5 0.0 0.1 0.1 0.0 0.1 0.1 0.0 0.8 0.9 0.9 Slovenia 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.1 0.0 0.0 0.3 0.3 0.1 0.2 0.3 0.1 0.2 0.4 0.4 0.4 Cyprus/Malta 0.0 0.0 0.0 0.3 0.3 0.3 0.0 0.1 0.1 0.3 0.4 0.3 Romania 0.2 0.2 0.2 0.3 0.4 0.3 5.2 5.9 6.0 5.7 6.5 6.5 Bulgaria 0.5 0.5 0.5 0.1 0.1 0.1 0.5 0.6 0.5 1.1 1.2 1.2 EU27 54.4 49.4 50.4 41.7 40.8 39.1 44.4 45.8 47.1 140.5 135.9 136.7 CO=compound,OF=onfarm Table2.5:wheat,barleyandmaizeconsumptioninEUanimalfeeds–industrialandon-farm(Mt)
  • 19. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat balances European Union wheat balances Methodology : Wheat balances reflect current prices and their implications for domestic and foreign demand. The purpose of the balances is to bring to light a potentialsurplusordeficitastheresultofanimbalanceinsupplyanddemandbased on current prices. This information can then be used to predict price fluctuations aimedatreducinganyimbalanceinthecomingmonths.Thepricechangescanthus causesubstantialmodificationofthebalances. Thesurplusordeficitisthedifferencebetweenclosingstocksontheopenmarket andtheminimumlevelofstockrequiredbyusersineachcountryuntilthenexthar- vestcomesin(safeguardstock).Asurplusindicatesthosequantitieswhichwilleither besoldtointerventionorfindanoutletontheinternalorexportmarkets.Adeficit indicatesarequirementforimports. Somecountries,forexampleGreece,shownegativeopeningorclosingstocks(atthe end or beginning of the crop year) because, for the sake of coherence, output is in- cludedinthebalancefromJuly,althoughtheharvestactuallygetsunderwayinJune. InterventionclosingstockattheendofJune,onanygivendateofcalculation,is: •theopeninginterventionstockon1July plus •totalofwheatalreadyofferedintointerventionforthecropyear minus •quantitiesalreadysoldbyintervention •projectedsalesbyinterventionthroughtotheendofthecropyear 19 Crop year 2010/11 EU wheat production in 2010 is revised up by 0.4 Mt al- though wheat imports fall by 0.3 Mt. Internal demand is revised up by 0.4 Mt (increase in demand in animal feeds offset by a reduction in milling); wheat exports on the world market are revised down by 0.3 Mt this month to 19.1 Mt. EU wheat stock on June 30 2011 therefore re- mains at a similar level to last month at between 8.5 and 9 Mt, which is almost 2 Mt less than the minimum stock required (to comfortably supply the market from June 30 until the next harvest comes in). The situation remains particularly tight in France, UK, Central Europe (Hungary and Poland) and southeast Europe (Romania/Bulgaria). Germany’s balance has tightened since last month. After the upward price movements seen at the begin- ning of May, this low stock forecast should prevent old crop prices falling sharply even though the likelihood of Russia’s and Ukraine’s early return to the market has increased. Crop year 2011/12 EU wheat production in 2011 falls sharply this month to 131.5 Mt (-3.6 Mt) due to the impact of the drought in the west EU countries and to winterkill losses in Lithuania and Poland. Consequently, projected wheat usage in on- farm animal feeds falls sharply (-1.3 Mt) but demand for wheat in animal feeds is still forecast higher than in 2010/11 (with demand captured from other grains). Demand for human consumption and industrial usage is also set to be higher than in 2010/11 (mainly biofuels sector) although this forecast has not altered significant- ly since last month. Intra-EU wheat trade is forecast to rise in 2011/12 on ac- count of higher internal demand (Netherlands mainly). Import volumes are set to fall sharply compared with the levels of 2010/11 in Germany and France (assuming that grain quality is in line with the norm in Germany). UK wheat remains much more competitive than French wheat for export to the south EU export destinations; meanwhile south-east EU wheat is competitive against UK wheat (and much cheaper than French wheat) for the south EU. We estimate that wheat stocks on the world market on July 1 2011 will be 20 Mt less than at the start of 2010/11. Global production is forecast to increase by 28 Mt but our estimate has decreased sharply since last month due to the drought in the EU, delays to plantings in the northern USA and, to a smaller extent in the Black Sea countries. World demand is still forecast high (690 Mt) due to the projected rise in demand for feed wheat at the expense of maize. Global wheat stocks at the end of 2011/12 will therefore decline slightly. World wheat trade in 2011/12 is set to be higher than in 2010/11 due to re- duced production in the Middle East and higher animal sector demand in Asia. In this context, we still envisage that the world market will require the totality of the EU’s export availability despite the combined 14 Mt increase in the availabilities in the Black Sea countries (Russia, Ukraine, Kazakhstan). Since last month we have reduced our forecast for EU wheat availability and we now fore- cast exports at barely 17 Mt. With this level of exports, the outlook for EU wheat is not heavy and stocks will remain low at the end of 2011/12. Generally speaking, this situa- tion should support new crop EU wheat prices, which are much cheaper than US prices. The fact that the outlook on the world market is fairly tight with relatively low stock forecasts is a second support factor. Nevertheless, wheat prices in the EU could still be momentarily influ- enced downwards when Russia and Ukraine resume exports in the summer.
  • 20. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat balances 20 kt 2007/08 2008/09 2009/10 2010/11 2011/12 USA 1613 664 294 885 965 Canada 946 937 774 695 846 Argentina 11 2 1 6 6 TotalAmerica 2570 1603 1069 1586 1817 Norway Switzerland Turkey 23 4 12 20 Albania Croatia 173 30 160 104 BosniaHerzegovina Serbia-Montenegro 168 1 18 169 32 OtherEurope Europe 364 35 178 285 52 Ukraine 179 3724 1038 59 1148 Rep.Moldova 3 64 21 28 20 RussianFed. 1230 405 311 64 250 Kazakhstan 422 89 249 213 228 TotalCIS 1834 4282 1619 364 1646 Australia 6 205 199 27 216 Un.ArabEmirates China misc. 12 10 25 9 106 Totalothers 18 215 224 38 322 Total 4786 6135 3090 2273 3837 Table3.1:breakdownofEU27imports bycountryoforigin Crop year 2010/11 Production Wheat production in the EU27 is revised up by0.4Mtthismonthto126.4Mt.Theadjust- ment concerns Belgium, Latvia (+80 kt each) and Romania (+250 kt). Last month we re- ducedourharvestforecastforRomaniaby400 kt but this month the downward correction is lessened to tie in other items on the balance sheet. Imports Wheatimportsfromthirdcountriesarerevised downby300ktthismonthto2.27Mt.There- ductionreflectsthelowvolumesshippedfrom some exporting countries to the EU and also the low level of licence applications received from importers. The reduction concerns im- port volumes from the USA (-150 kt), Serbia (-70 kt) and Australia (-80 kt). We previously envisaged a small volume of Australian wheat imports in Spain and Portugal; this forecast has now been cancelled. US SRW wheat is currentlyslightlydearerthanUKwheattothe southEUcountries;SRWisevenlesscompeti- tive than last month. Also, Serbian wheat ex- portstotheEUhavebeenreducedbecausethe countryhasdecidedtoblockexportsinthelast monthsofthecropyear. May 3, EU export licence fixations totalled 1.924Mt.TheCommissionwillneedtoissue 350ktinMayandJune(comparedwith100kt issuedinApril). Demand for wheat for human con- sumption and industrial usage Demand for wheat for human consumption andindustrialusageisreviseddownagainthis month, falling 0.2 Mt to 58.1 Mt. The reduc- tion concerns milling wheat usage in France (-130 kt), Germany (-90 kt) and Austria (-10 kt) and reflects the inclusion of the latest of- ficial statistics in our forecasting (March for France, February for Austria and January for Germany).Also,demandforwheatinthebio- ethanolsectorhasdecreasedby15ktinAustria toreflectdatareleasedbyAgrarMarktAustria. Total EU27 demand for human consumption and industrial usage is now fore- cast 1 Mt up on the level of 2009/10, due to the growth inwheatusageinthebiofuels sector. Demand for milling andstarchisnowforecaststa- bleattheEUlevelcompared with2009/10. NB:Subscriberstothe“EU Biofuels”moduleonourweb- sitestrategie-grains.com,can consultthefulllistofbioetha- nolrefineriesandproduction capacities,andabreakdown ofbiofueloutputvolumesby countryandcropyear. Demand for wheat in animal feeds Demandforwheatinanimal feeds is revised up by 600 kt this month to 49.4 Mt; this reflects the impact of several changes:  Wheat usage in indus- trial feeds is revised up in Germany to reflect the inclusion of official statistics for January (feed production re- vised up and wheat incorporations also re- visedup);  Wheat usage in industrial feeds revised up in France (+70 kt) and Italy (+110 kt) to reflect the latest demand statistics and to reflectimportlevels;  WheatusagereviseddowninPoland(-220 kt)duetoadjustmentsmadetosupplyand demanditemsforthelast5years;  On-farm consumption estimated down 200ktinFrancetoreflectthelateststatistics for stocks held by stock keepers and wheat users dated March 31. On-farm wheat us- age in Germany is estimated down 200 kt forthesamereason. Total EU27 feed wheat usage in animal feeds is now forecast 5 Mt down on the level of 2009/10. Crop year 2011/12 Production EU soft wheat production in 2011 is cur- rentlyestimatedat131.5Mt.Sincelastmonth it has decreased by 3.6 Mt, with reductions for France (-1.5 Mt), Germany (-1.2 Mt) and Britain (-325 kt). The reductions in all three countries reflect the lack of rain in April and thebeginningofMay. Estimated production has also declined in Lithuania (-320 kt) to reflect the extent of winterkill this year on wheat area. In Poland, estimatedproductionfallsby(-290kt)because of the impact of the bad weather through the winter(cold). Despite this significant reduction, EU wheat production is still forecast slightly higher than the level of 2010 (+5.2 Mt). The countries registering the largest increases are Germany (+1.4 Mt), UK (+860 kt), Hungary (+570 kt),Poland(+410kt),andFrance(+370kt). Imports Little change this month: we estimate wheat imports in 2011/12 at 3.8 Mt. We maintain ourforecastforasharpincreasecomparedwith 2010/11 because of the better wheat harvest expectedintheBlackSeacountries.Although the exportable wheat surpluses in these coun- triesarestillforecastsignificantlylowerthanthe Supply and internal demand 2010/11: production revised up, imports revised down 2011/12: sharp fall in estimated production generates decline in projected wheat usage in animal feeds
  • 21. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat balances 21 July-June 2011/12 carry-instockimportsgrainsexportshum/ind.consump.animalfeed others (seeds, waste and overseas usage) intervention stock free stock requirement intervention free total production of which: ex-farm sales from EU 27 from non-EU supply to EU 27 to non-EU total flour exp. to non-EU biofuels internal consump. total compound feed on-farm feed demand free stock carry-out stock surplus/deficit Ger.0132513252462820547321521291904694373087491157777857968541125573103927897012931293-2201518 Bel/L0225225202230301355412365492981349103216001727152919860518202302300235 Den.04584585359292116120115613533670329374413952349289566004594590460 Spn.033334924360313719931733443154163012567044141256479966602652650269 Fra.0198719873600732541627638627690397221052358911818753806746843383106936283023442344-2402585 Gre.0-232-2324414742849684928509232774012490-281-2810-277 Irl.-065657793661012203739500395696371325191147-07373076 Ita.07777773273331510918456555497210547618571421436287769607607600758 Neth.02282281233516047666944350297396642300287349638902802800277 Por.08686641160129143943095015093534414135108888089 U.K.-0136113611574266962218394226021760651246635564274300212736016674-017201720-1201843 Aust.-066146513454993197360820929433958621212191601829-01441440147 Fin.41391438466501054357-0263102622551051505993441161200116 Swed.094942346174726212822151224042979472748024784253208989086 Pol.036736794853205101778136044676044613140134117991050953006476470643 Hun.016316341897904430106631612392012371224347419202382380239 Cz.R.-06956954320350505013225128002241056151110464651914308-07417410739 Slk.019919913325601588243142000420620120140401841840182 Est.-047473875804921142067106620831440-05252052 Lat.01241241137305215685454862178471621643812648146101081080108 Lit.-01881881844763211063062531136302266482181171949-01611610160 Sln.01212127129427231-0173220151323111825202020016 Cyp.00012103241390139001390013900000 Mal.0009300390360036003604400 Rom.019619657874615564991187854342440342023062763210178178-100279 Bul.0117117379121739351091498136311121250489336377801571570157 EU 15465536557991282264937391320731728113942467981135608439578425613907124489475807584-5808183 EU254834883521219712384137751579392204515454551461177636247608497265828148200497359738-58010322 EU27486618665131548243223837168372243221680659933118264745227750445679215829941007010074-68010757 Table3.2:EU27wheatbalanceJuly/June2011/12(kt)
  • 22. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat balances 22 July-June 2010/11 carry-instockimportsgrainsexportshum/ind.consump.animalfeed others (seeds, waste and overseas usage) demand intervention stock free stock requirement intervention free total production of which: ex-farm sales from EU 27 from non-EU supply to EU 27 to non-EU total flour exp. to non-EU biofuels internal consump. total compound feed on-farm feed free stock carry-out stock surplus/deficit Ger.02019201923243197903760312905343093048878411582478451054742636284103927727013251325-2601588 Bel/L021021020012892101520337252990349106415781551138117060497802252250227 Den.09949945056357126419140622833470327370414362268289596104584580456 Spn.04824824689337034988907103222152212986508438941190479885703333-210246 Fra.03271327135639329289155398316366129671025558911508516719243182874106337843019871987-4502434 Gre.0-282-2823615791758335192250917974010650-232-2320-236 Irl.-0717163929901008383830038350324825519944-06565062 Ita.09219213317356290187016285496210547520711475596287792307777770779 Neth.02432431362401067568350713239191092272249549545502282280232 Por.010710762106457129112094815093323114120508686081 U.K.-0186218621487861639617752220929771155769634264104376203436016392-013611361-4201778 Aust.-01313141411383966182955939939433959622713097601823-066-140150 Fin.271882157244009791375250102493851951895983641391430139 Swed.0929221842671225552501031219043478580549730884246109494089 Pol.14924939077355899328541134455604449309412941799105095650367367-270639 Hun.15432247636181140420810582601233201231115034540450163163-70232 Cz.R.93734828398536048481334611080571051151510654501914154-06956950697 Slk.3644648111857321742271246000460690120154301991990199 Est.-0909032487050215867106619931455-04747050 Lat.0999997332121395688752178471622433920448127101241240127 Lit.035835817081166218982134731436305402443581172001-01881880192 Sln.017171528082572812165220143242311824601212015 Cyp.010101394221390139001390013900000 Mal.03310210330330033003300000 Rom.0125125596646298665110951063342440342024762764550196196-80280 Bul.722322937922013405512945241283114126850033639380117117-40152 EU 15271019210218955702212521131300261630416715452471135490939203413013902123469465536557-14808026 EU2531012763130731166152342321621552722151617530534371177502047240486175821146920483488352-182010178 EU2731713111134271263732390522731659782390519117581441182503451928493646784157313486618665-194010610 Table3.3:EU27wheatbalanceJuly/June2010/11(kt)
  • 23. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat balances 23 UK small b. Fob feed wheat Germany B wheat small b. delivered HbgFrance, dlvd Rouen on a July base, stand. wheat 85 100 115 130 145 160 175 190 205 220 235 05/10 07/10 09/10 11/10 12/10 03/11 04/11 Jan-March Oct-Dec 2010 Apr-June 2011 (spot) £/t 100 120 140 160 180 200 220 240 260 280 05/10 07/10 09/10 11/10 12/10 03/11 04/11 €/t 100 120 140 160 180 200 220 240 260 280 05/10 07/10 09/10 11/10 12/10 03/11 04/11 €/t levelsof2009/10,weneverthelessforecastthat exportsfromUkraine,RussiaandKazakhstan to the EU could increase by around 1.6 Mt in total which is a moderate hypothesis. We also forecast a small increase of 150 kt for im- ports from Canada (assuming grain quality in Canada returns to normal after the problems experiencedin2010/11). This rise in projected imports concerns Spain to the greatest extent (+1 Mt), then the UK (+0.2 Mt), Italy (+0.2 Mt) and Greece (+0.1 Mt).Thisforecastwillbesubjecttosignificant change depending on final harvest volumes andgrainqualityin2011intheBlackSeaand NorthAmericancountries. Demand for wheat for human con- sumption and industrial usage Demand for wheat for human consumption andindustrialusageisestimatedat59.9 Mt(no changesincelastmonth).Itisnowforecast1.8 Mtuponthelevelof2010/11. The growth in demand compared with 2010/11mostlyconcernsbioethanolproduc- tion in the UK (corresponding to the launch of a new refinery despite a delay) and Czech Republic. We also forecast a 230 kt increase inmillingwheatusage,mainlyinFrance(after the slump recorded in 2010/11) and a 120 kt increaseinthestarchsector. Demand for wheat in animal feeds Weestimatedemandforwheatinanimalfeeds at 50.4 Mt. It has decreased by 1.3 Mt since last month. This reduction mostly relates to wheat usage in on-farm feeds in France (-0.6 Mt), UK (-0.2 Mt), Germany (-0.2 Mt), and Austria(-0.1Mt)andcorrespondstothesmall- er harvest forecasts in these countries. Despite this reduction to on-farm wheat usage, overall demand for wheat in animal feeds remains forecast slightly higher in 2011/12 (+1.1 Mt comparedwith2010/11)attheexpenseofthe other cereals. It is nevertheless forecast much lower than in 2009/10 (-4 Mt). Our estimate therefore has substantial increase potential of around 3 Mt, which would be triggered if wheat’s competitiveness improves compared with the other cereals. It also has a decrease potential,whichwouldbetriggeredbytheop- positescenario,althoughthisissmaller(1to2 Mt). Price comparison between the different origins dated 6/05/2011 Downward trend since the end of April Situation in each country Table 3.4 shows the main price changes since lastmonth. Old crop prices Germanpriceshavestayedrelativelystable(+1 %). Elsewhere in west Europe, old crop prices arelowerthanamonthago,havingfallenby17 €/t in France (-7 % spot) and 8 £/t in Britain (11 €/t, -4 %). In the southern countries, old croppriceshavenotchangedgreatly. IntheeastEU,HungarianandRomanianold cropwheatisnolongerquotedonmarkets;by contrastthePolishpricehasrisensharply(+18 €/t for feed wheat and +16 €/t for milling wheat). New crop The trend is downward in the west EU coun- tries: French and German wheat prices have fallen by around 10 €/t (-4 %) for October- December;UKwheatremainedstableinster- ling but lost around 2 €/t (due to the pound’s depreciation again the euro since the start of April). Romanian and Bulgarian prices also eased,fallingbyaround15€/tsincethebegin- ningofApril. By contrast, the price of Hungarian wheat on theBudapestexchangeroseslightlyforAugust 2011contracts(feedandmillingwheats). Conclusion With the exception of Hungarian, Polish and oldcropGermanwheat,allwheatoriginsinthe EUarecurrentlycheaperthan(oratleastpriced thesameas)lastmonth.OldcropFrenchand UKpricesfellmoresteeplythannewcroppric- es.However,beforeregisteringthisdownward correction, prices continued in the ascendant until April 20. Old crop wheat prices were ef- fectivelybuoyedbytheextremelylowforecasts for year-end stocks. However, since April 20, they have been subject to downward pressure inresponsetothepricefallsontheUSmarket andtheanticipationthatRussia’sandUkraine’s returntotheworldmarketwillhappensooner than previously expected. Concerns over the weather(lackofraininthewestEU)neverthe- lesstemperedtheextentofnewcroppricefalls. Graphic3.1:changesinGerman,UKandFrenchwheatprices
  • 24. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat balances 24 6May 8Avr change Germany(€/t) francoHamburg Ewheatspot 275.0 272.0 3.0 1% Awheatspot 265.0 262.0 3.0 1% Bwheatspot 255.0 252.0 3.0 1% feedwheatspot 241.0 237.0 4.0 2% ENov 235.0 244.0 -9.0 -4% ANov 225.0 234.0 -9.0 -4% BNov 215.0 224.0 -9.0 -4% UnitedKingdom(£/t) 25ktshipdelivery May-June 200.0 208.0 -8.0 -4% Oct-Dec 172.0 172.0 exchange£/euro 1.127 1.137 -1% France(€/t) standardwheat(15/4/2/2)dlvedRouen May-June 235.3 252.3 -17.0 -7% Oct-Dec 209.2 218.7 -9.5 -4% MatifEuronextMay 240.0 247.3 -7.3 -2,9% 6May 8Avr change Spain(€/t) feedwheatdldCatalonia 252.0 250.0 2.0 1% Italy(€/t) OrdinarybreadwheatMilan 280.5 279.5 1.0 0% Hungary(BCE)Huf/t feedAug 47500 46500 1000 2% millingAug 52000 49500 2500 5% exchangeeuro/HUF 265,0 264,1 0% CzechRepublic-Brnoexchange(€/t) feedspot millingspot Poland-nationalaverageofdeliveredprices(€/t) feedspot 241,3 223,0 18,3 8% millingspot 252,2 236,0 16,2 7% Romania/Bulgaria-FobBlackSea(€/t) Italy SpainMed SpainNorth May Jun Oct/Dec May Jun Oct/Dec May Jun Oct/Dec FrenchminusEnglishprice €/t 9.5 17.2 18.4 9.5 17.2 18.4 10.9 18.6 19.7 £/t 6.0 15.3 16.3 6.0 15.3 16.3 6.8 16.5 17.5 Old crop German wheat is now significantly dearerthanFrenchwheat(spreadof15€/tbe- tweenGermanBwheatinHamburgandstan- dard French wheat in Rouen); however, the more normal spread of 5 to 6 €/t for German wheat over French wheat is reinstated from November. On both old and new crop contracts, UK wheat remains much cheaper than French wheatforsouthEUdestinations.However,its advantageonnewcropcontractshasnarrowed (UK prices remained stable whilst French prices decreased); the advantage is now 18 to 20 €/t depending on ship size, down from 24 €/tlastmonth.Onnewcropcontracts,south- eastEUwheatisnowcompetitiveagainstUK wheat(andmuchcheaperthanFrenchwheat) forsouthEUdestinations. N.B:inordertofacilitatethecomparisonbe- tweenthevariousorigins,Table3.5showswhole prices,i.e.pricesthatinthecaseofFranceinclude monthlyincrements(despitethehalvingofthe officialinterventionincrement,weareusing anincrementof0.93 €/tpermonthformarket prices). Table3.4:wheatpricesinvariousEUcountriesasof06/05/2011 Table3.5:spreadsbetweenFrenchandUKwheatpricesdated 06/05/2011,deliveredItalyandSpain Intra-EU wheat trade 2010/11: French and Danish exports revised down— 2011/12: trade volume forecast stable with increased imports in Netherlands and reductions for France and Germany Crop year 2010/11 Weestimateintra-EUwheattradein2010/11 down0.2Mtthismonthto23.9Mt. To take account of the latest customs statistics and recorded sales commitments so far, we have decreased estimated French and Danish exportsby270kteach.Thisispartlyoffsetby increased export forecasts for Poland (+110 kt)andAustria (+100kt). Wehavethismonthreducedourimportfore- castsforBelgium(-80kt),Spain(-200kt)and Latvia (-90 kt). Latvia imported less wheat from Lithuania than previously expected (Lithuania having instead shipped more than previouslyexpectedtoBelgium). Thetotalvolumeoftradein2010/11remains close to the level recorded in 2009/10 (-270 kt). However, the structure of this trade changed considerably between 2009/10 and 2010/11. France exported a great deal lesstootherEUmembersin2010/11thanin 2009/10(-1Mt).Ineffectin2010/11,France maximiseditsexportsofmillingwheattothird countries due to the excellent quality wheat it produced in 2010 and in response to the low levelofmillingwheatoutputinGermanyand strongworlddemandfollowingRussia’sretreat from the market. As a result, France reduced its exports to other EU countries. Hungary also exported less to other EU countries than in2009/10(-250kt)inresponsetoitssmaller harvest, as did Sweden (-150 kt). By contrast, Germany,PolandandLatviaallshippedacon- siderably larger volume to other EU countries (+280kteachfromGermanyandPoland,and +230 kt from Latvia); these exports mainly comprisedfeedwheat. On the import side, several countries import-
  • 25. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat balances 25 origins destinations 2011/12 Ger. B/L Den. Spn. Fra. Gre. Irl. Ita.Neth. Por. U.K. Aust. Fin. Swe. Pol. Hun. Cze. Slk. Est. Lat. Lit. Sln. Cyp. Mal.Rom. Bul. EU Ger. 1104 83 56 189 45 26 473 2051 59 354 169 2 29 -4 16 3 1 1 2 5 11 4 8 7 1 4694 B/L 32 2 1 92 0 0 2 209 0 11 0 0 14 2 0 0 0 0 0 0 0 0 0 0 0 365 Den. 320 39 98 138 0 49 0 267 69 37 0 8 75 29 0 0 0 24 0 3 0 0 0 0 0 1156 Spn. 0 0 0 7 0 0 9 0 50 7 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 73 Fra. 468 1451 10 720 106 97 1496 1759 581 119 0 0 0 2 0 5 0 0 0 1 0 67 19 2 0 6903 Gre. 0 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2 4 Irl. 0 0 0 0 0 0 0 5 0 32 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 37 Ita. 12 3 1 0 20 0 0 5 0 2 2 0 0 0 0 0 0 0 0 0 1 0 0 8 0 55 Neth. 126 175 1 85 16 0 0 3 6 14 0 1 13 0 0 0 0 0 0 0 0 0 2 0 0 443 Por. 0 0 0 43 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 43 U.K. 68 164 14 896 68 10 179 58 594 209 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2260 Aust. 56 5 0 0 8 10 0 482 13 0 0 0 0 0 6 4 3 0 0 0 9 0 0 3 8 608 Fin. 56 0 8 173 0 0 4 3 2 0 69 0 7 1 0 0 0 30 3 0 0 0 0 0 0 357 Swed. 47 0 46 90 5 0 2 0 34 6 2 0 44 5 0 0 0 0 0 1 0 0 0 0 0 282 Pol. 728 0 2 3 32 0 3 4 19 4 2 0 2 5 0 1 5 0 0 2 0 0 0 0 0 813 Hun. 60 5 0 2 4 118 0 311 29 0 1 155 0 0 15 6 17 0 0 0 87 13 0 236 7 1066 Cz.R. 912 1 0 0 0 0 0 11 1 0 0 113 0 0 221 11 30 0 0 0 20 0 0 0 1 1322 Slk. 36 0 0 4 0 4 0 27 26 0 0 51 0 0 36 41 15 0 0 0 2 0 0 1 0 243 Est. 15 0 1 8 4 0 5 0 22 0 4 0 4 16 0 0 0 0 34 2 0 0 0 0 0 114 Lat. 104 7 105 152 11 0 2 32 63 0 3 0 0 3 2 0 0 0 -0 63 0 0 0 0 0 545 Lit. 116 51 20 72 23 0 0 13 23 15 0 0 5 12 10 0 0 0 3 267 0 0 0 0 0 630 Sln. 0 0 0 0 0 0 0 30 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 31 Cyp. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Mal. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Rom. 58 25 0 561 8 54 0 331 30 83 13 8 0 0 0 4 0 0 0 0 0 0 10 1 2 1187 Bul. 1 0 0 638 0 127 0 29 7 78 0 0 0 0 0 0 0 0 0 0 0 0 8 0 204 1091 EU 3215 3030 292 3603 627 474 366 3315 5160 1160 669 499 65 174 320 79 35 56 58 305 76 129 103 30 461 21 24322 origins destinations 2010/11 Ger. B/L Den. Spn. Fra. Gre. Irl. Ita.Neth. Por. U.K. Aust. Fin. Swe. Pol. Hun. Cze. Slk. Est. Lat. Lit. Sln. Cyp. Mal.Rom. Bul. EU Ger. 1086 77 54 243 70 35 365 1735 59 349 78 3 38 41 31 4 1 1 3 0 13 3 6 13 1 4309 B/L 41 1 1 128 0 0 1 163 0 18 0 1 17 2 0 0 0 0 0 0 0 0 0 0 0 372 Den. 327 126 110 149 0 63 0 305 60 43 0 15 122 27 0 0 0 59 0 2 0 0 0 0 0 1406 Spn. 0 0 0 13 0 0 18 0 36 5 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 71 Fra. 599 1109 12 844 264 32 1717 983 611 112 0 0 0 1 0 1 0 0 0 1 0 63 12 4 0 6366 Gre. 0 0 0 0 3 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 0 0 1 5 Irl. 0 0 0 0 0 0 0 4 0 34 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 38 Ita. 17 3 2 0 23 0 0 6 0 4 1 0 0 0 0 0 0 0 0 0 0 0 0 4 0 62 Neth. 135 182 1 114 24 0 0 1 9 10 0 2 27 1 0 0 0 0 0 0 0 0 1 0 0 507 Por. 0 0 0 12 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 12 U.K. 210 217 22 624 191 16 155 78 587 108 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2209 Aust. 79 1 0 0 6 10 0 421 5 0 0 0 0 0 7 5 3 0 0 0 9 0 0 4 8 559 Fin. 39 0 14 50 0 0 2 6 4 0 15 0 5 1 0 0 0 0 1 0 0 0 0 0 0 137 Swed. 51 0 64 100 4 0 1 0 17 5 2 0 2 3 0 0 0 0 0 2 0 0 0 0 0 250 Pol. 650 1 2 83 44 0 5 2 35 4 3 0 3 10 1 2 5 0 0 2 0 0 0 0 0 854 Hun. 88 2 0 2 6 89 0 393 12 0 0 184 0 0 11 6 17 0 0 0 57 11 0 175 4 1058 Cz.R. 975 1 0 0 0 0 0 15 2 0 0 76 0 0 194 22 47 0 0 0 0 0 0 0 2 1334 Slk. 57 0 0 5 0 2 0 24 9 1 0 45 0 0 56 51 18 0 0 0 1 0 0 2 0 271 Est. 49 0 1 16 9 0 2 0 19 0 2 0 7 24 0 0 0 0 24 4 0 0 0 0 0 158 Lat. 151 11 139 146 21 0 3 25 54 0 3 0 0 5 3 0 0 0 22 104 0 0 0 0 0 688 Lit. 212 101 21 23 46 0 0 26 22 30 0 0 7 19 15 0 0 0 6 293 0 0 0 0 0 821 Sln. 0 0 0 0 0 0 0 27 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 28 Cyp. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Mal. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Rom. 79 51 0 557 3 24 0 281 38 26 14 11 0 0 0 3 0 0 0 0 0 0 3 1 3 1095 Bul. 1 0 0 629 0 103 0 162 10 116 0 0 0 0 0 0 0 0 0 0 0 0 13 0 260 1294 EU 3760 2892 357 3370 915 579 299 3562 4010 1064 616 396 40 267 355 114 36 73 87 321 116 80 94 21 462 20 23905 Table3.6:intra-EU27wheattrade2011/12(kt) Table3.7:intra-EU27wheattrade2010/11(kt)
  • 26. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat balances 26 May Jun Jul Aug US$/t 6/05 6/05 6/05 6/05 French wheat220Hagberg,11%prot,74TW 347 French standardwheat 347 310 308 309 Englishfeedwheat(bigboats) 332 294 294 Englishfeedwheat(smallboats) 328 278 278 Danishwheat(bigboats) Danish wheat(smallboats) Ger. Mill.wheat14%prot(3kt) 405 347 Germanmillingwheat13%(3kt) 384 332 Germanmillingwheat12%(3kt) 370 318 USSRWwheat 299 308 327 331 USHRWwheat 344 349 361 361 Argentineanwheat 360 BlackSeamillingwheat(25kt) 305 BlackSeafeedwheat(25kt) 275 Bulg/Romanianwheat 266 270 272 Ukrainianbarley Frenchbarley 273 270 270 USmaize 305 287 Frenchmaize 343 347 301 303 Bulg/RomanianMaize 334 338 283 284 Ukrainianmaize 314 ed much less wheat than in 2009/10: Latvia (-290 kt), Poland (-160 kt), Portugal (-360 kt), Netherlands (-220 kt), Italy (-350 kt) and Spain (-1 Mt). These sharp decreases are ex- plainedbythereductioninwheatusageinani- mal feeds in these countries and that fact that maize gained precedence in terms of bioetha- nolproductionintheNetherlands.Meanwhile Germany imported a great deal more wheat thanin2009/10(+1.1Mt)inresponsetothe majordeclineingrainqualitythatitsufferedin 2010. France also imported more wheat than normalfromotherEUcountries(+0.5Mt)in 2009/10;thiswasbecauseitexportedmassive quantities of high quality wheat to the world market, which allowed more feed wheat im- portsthanusualintoitsnorthernandwestern regions. Crop year 2011/12 The volume of intra-EU wheat trade in 2011/12isnowestimatedat24.3Mt,upby0.4 Mtcomparedwiththeforecastfor2010/11. Germany is set to import much less wheat than in 2010/11 (-500 kt reflecting a smaller import need for milling wheat assuming that grain quality returns to normal in 2011); France is also set to import less (-300 kt) be- cause we expect it to ship less wheat to third countries, meaning that it will need to import less feed wheat in replacement. By contrast, Dutch imports are forecast to increase sharply inlinewithrisingdemand(+1.15Mt). On the export side, a number of countries are settoexportmorewheattootherEUcountries thanin2010/11:France(+500kt),Germany (+400 kt), UK (+50 kt), and Finland (+220 kt).Meanwhile,weforecastlowerexportship- ments from Denmark (-250 kt), the Baltic countries (-330kt)andBulgaria(-200kt). Thisfirstforecastforintra-EUwheattradewill be subject to significant variation in the com- ing weeks and months to reflect the quantity and quality of the harvests and changes to the globaleconomicenvironment. N.B:Subscriberstoouronline“Intra-EU Trade” webmodulecanconsultthefullbreak- downofintra-EUwheattrade(including recordedandprojectedvolumesforeachcountry) atourwebsitestrategie-grains.com. Table3.8:FOBpricesofmajorworldwheatoriginsasof06/05/2011 World wheat market 2010/11: ending stock reduced by 24 Mt — 2011/12: tighter outlook reflecting weather concerns Downward price movements on world market – anticipation that the Black Sea countries will return to the market sooner than expected May 6 2011, US SRW wheat FOB Gulf was tradingat299$/tforspot/near-termcontracts (last month: 326 $/t), and 308 $/t FOB for August (last month: 325 $/t), see table 3.8. HRW was trading at 344 $/t FOB spot (last month:370$/t)and349$/tFOBforAugust (lastmonth:375$/t). Since April 8, US wheat prices have fallen sharply, by 27 $/t for SRW and by 26 $/t for HRW(spot/near-term). ThisdownwardevolutionspreadontotheEU market:onMay6Frenchwheatwastradingat 347 $/t for spot/near-term (last month: 368 $/t) and at 308 $/t for October (last month: 320 $/t). UK wheat was trading at 328 $/t for spot/near-term (last month: 340 $/t) and 278 $/t for October (last month: 281 $/t). German type B wheat was trading at 370 $/t for spot/near-term (last month: 363 $/t) and 318 $/t for November. German type A (high quality milling wheat) was trading at 384 $/t for spot/near-term (last month: 377 $/t) and 332$/tforNovember.Withtheexceptionof German prices, all EU wheat have decreased sincelastmonth,by12$/tand21$/trespec- tivelyforUKandFrencholdcropprices(spot/ near-term)andby3$/tand12$/trespectively for UK and French new crop. French wheat pricesfellmostsharply. ThesepricefallsinEuropeandAmericaareex- plained by several factors: firstly, rains fell over theUSwinterwheatplains,whichlimitedthe damage to the HRW crops (although some parts of Oklahoma and Kansas remain in a verycriticalsituationwithregardtowateravail- ability); in the EU, the small amount of rain that did fall at the end of April may also have contributed to the decline (but only to a very modest extent given that the amount of rain was extremely small). The first week of May also saw a wave of sales on the part of invest- ment funds, which was triggered by the fall in theoilprice. Lastly, since the end of April, the market has begun to anticipate that Russia and Ukraine could resume exports rather sooner than previously expected and this had a down- ward impact on the prices of other (especially European)origins.
  • 27. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat balances 27 50 100 150 200 250 300 350 400 450 Sep-92 Mar-95 Sep-97 Mar-00 Sep-02 Mar-05 Sep-07 Mar-10 $/t Fob Rouen SRW Fob Gulf traded prices SRW aer bonus Fob Rouen prices before export tax/restit. Ukraine announced the end of political con- trol of wheat exports and the end of its quota arrangementsfromJuly12011.(Barleyexports will also be liberalised on this date; for maize, quotas will end in May). However, Ukraine’s parliament recently voted to introduce an ex- port tax, although neither the scale of the tax, northedateofintroduction,haveyetbeende- cided; export outlooks therefore remain fluid. In Russia, the situation is much the same as outlined last month: ending stock is probably higherthanpreviouslyestimatedduetoalower levelofanimalsectorconsumptionthanprevi- ously forecast (we took this into account last month)andapossibleunder-estimationofthe 2010harvest.Inanycase,itisnowmuchmore likely that Russia will return as an exporter on the world market in 2011/12 and that its return could happen sooner than previously expected because of pressure to free up silo space in the south of the country (movement of grain stocks from the interior to silos near the ports has been reported, which backs up theanticipationonthepartofsomeoperators that Russia will resume exports sooner rather than later). Given the timeframes required for government actions in this regard, we would expect that Russia’s government will make a decisiontowardstheendofMay. Old crop French and German wheats are respectively 48 and 71 $/t dearer than SRW. They are respectively 3 $/t and 26 $/t dearer than HRW in FOB terms; this situation meansthatFrenchwheatremainscompetitive ontheworldmarket. In terms of new crop prices through the summer,Frenchwheat(FOB)ispricedvirtu- allythesameasSRWand40$/tcheaperthan HRW. Fromtheautumn, French is 20 to 25 $/t cheaper than SRW and 50 $/t cheaper thanHRW;GermanBwheatis13$/tcheap- erthanSRWand43$/tcheaperthanHRW. European wheat is therefore very attractive comparedwithAmericanwheat. The first new crop prices have appeared on markets for Black Sea origins at 275 $/t for Ukrainian feed wheat and 300 $/t for Ukrainian milling wheat (although no prices asyetforRussianwheat). Europeanpriceshaveinrecentweeksbeensub- jecttodownwardimpactofthepossibilitythat Russia and Ukraine will return to the export markets. This possibility seems to have been completelyfactoredintolonger-termcontracts (from autumn) and explains the existence of thewidespreadbetweenEUandUSpricesfor thisperiod;theanticipationisalsonowbegin- ning to impact prices for the start of crop year 2011/12 although in a less pronounced man- ner; prices for July-September have a further decreasepotential,whichwouldbetriggeredif RussiaandUkraineresumeexportsinJuly. World ending stock 2010/11 reduced slightly Globalwheatproductionin2010/11remains forecastat647Mt.Demandforwheatinani- malfeedsisrevisedupby1.1Mtthismonthto 124.1Mt(attheexpenseofmaize,mostlyin China);itisnowforecast8.5Mton2009/10. Demandforwheatforhumanconsumption isrevisedupby2Mtthismonth,reflecting importvolumesandadjustmentstosupply anddemanditemsinseveralcountries,most importantlyIndonesia.Totalglobaldemandis nowforecastat671.4Mtupfrom668Mtlast monthand657,4Mtlastyear. Estimatedendingstockthereforefalls3.7 Mtthismonthto166.1Mt.Worldwheat stocksarenowsettofallbymorethan24Mt through2010/11andarenowestimatedat 24.7%ofannualdemandcomparedwith25.4 %lastmonthand29%attheendof2009/10. Projected wheat stocks at end-2011/12 continue to fall Table3.9showstheoutlookfortheworld wheatmarketin2011/12.Worldproduction in2011fallsfrom681.9Mtlastmonthto 675.2Mt;itisstillsettobe28Mtmorethan in2010.However,theoutlookistighterthan lastmonthbecauseoftheweather-related problemsimpactingcropsinsomethemain wheat-growingregions. Global wheat harvest in 2011 fore- cast lower than last month but still higher than in 2010 Developmentconditionsremainfavourable intheCISdespitetheplantingdelaysinRussia andUkraine,andproductionthereshouldbe verymuchhigherthanin2010(+19Mtfor UkraineRussiaandKazakhstan).Production isforecasttoincreaseinCanada(+2.4Mt), EU(+4.4Mt),India(+3.6Mt)andNorth Africa(+2.3Mt). ThesituationremainsworryingintheMiddle Eastandrecentrainfallinthisregionwasnot sufficienttoallowproductionlevelstomatch thoseoflastyear.Wecurrentlyenvisageare- ductionof1.5Mtin2011/12forthisregion. HarvestforecastsestimateddownforRussia, UkraineandKazakhstan InRussia,springwheatareaisreviseddownby 1Mhathismonthfrom14.5to13.5Mhadue toplantingdelays,whichareparticularlysevere inthecentralregions.Winterconditionsstill persistintheseareasanditseemsunlikelythat plantingswillattaintheagricultureministry’s forecastof14Mha.Totalharvestablewheat areaisnowestimatedat25.2Mhaandwees- timateRussia’s2011harvestat53.1Mt,down from55Mtlastmonth.Harvestableareain 2011isstillforecastsignificantlyhigherthanin 2010(22Mha). InUkraine,wehavereducedourforecastfor wheatproductionby0.6Mtthismonthto 19.6Mt.Developmentconditionsforthe winterwheathavebeengooddespiteaperiod ofdrought.FromFebruary20throughMarch Graphic3.2:changeinworldwheatpricesonaper- monthbasis(FOBmainoriginsinUS $/t)
  • 28. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat balances 28 Ukraine Russia Kazakhstan Mt 09/10 10/11 11/12 09/10 10/11 11/12 09/10 10/11 11/12 carry-instocks 2.2 2.2 4.4 10.8 13.9 6.3 2.6 3.7 2.0 production 20.9 17.2 19.6 61.7 41.5 53.1 16.2 10.3 14.9 imports 0.0 0.0 0.0 0.3 0.1 0.5 0.0 0.0 0.0 exports 9.2 3.4 9.9 18.4 3.4 8.9 4.0 2.7 5.0 consumption 11.7 11.6 12.5 40.5 45.8 43.8 11.1 9.2 9.7 carry-outst. 2.2 4.4 1.6 13.9 6.3 7.2 3.7 2.0 2.2 Mt 2008/09 2009/10 2010/11 2011/12 SG USDA SG USDA SG USDA SG USDA carry-instocks 126.0 125.5 166.3 166.2 190.4 196.2 166.1 182.2 production 681.9 682.2 681.5 684.2 647.0 648.1 675.2 669.6 ofwhichUSA 68.0 68.0 60.4 60.4 60.1 60.1 59.0 55.6 Canada 28.6 28.6 26.8 26.9 23.2 23.2 25.6 26.0 Australia 21.4 21.4 21.9 21.9 26.3 26.0 24.7 24.5 Argentina 10.1 10.5 11.0 11.0 14.7 15.0 13.4 13.5 EU27 150.0 151.1 137.6 138.6 135.5 135.8 139.9 138.6 Russia 63.7 63.7 61.7 61.8 41.5 41.5 53.1 53.0 Ukraine 25.1 25.9 20.9 20.9 17.2 16.8 19.6 19.0 Kazahkstan 12.9 12.6 16.2 17.1 10.3 9.7 14.9 15.0 India 78.6 78.6 80.7 80.7 80.7 80.8 84.3 84.0 China 112.5 112.5 115.1 115.1 114.5 115.0 115.0 115.5 NorthernAfrica 14.4 14.4 20.2 20.3 16.1 16.1 18.4 19.1 Mideast 32.3 30.3 37.2 38.4 38.7 40.2 37.2 37.9 trade 137.8 140.3 133.2 134.7 129.1 124.2 140.0 125.7 animaldemand 117.9 117.9 115.6 119.2 124.1 122.8 129.7 124.2 totaldemand 641.5 641.5 657.4 654.3 671.4 662.1 686.9 670.5 carry-outst. 166.3 166.2 190.4 196.2 166.1 182.2 154.3 181.3 31,rainfalltotalledonly20to40%ofthe seasonalnormandbetween10and20%in thesouth(source:Ukragro).Yieldistherefore reviseddowntoreflectdelayedspringwheat plantingsandthedryconditions,whichpre- ventedoptimumuptakeoffertilizer. EstimatedwheatareainKazakhstanfalls to13.6Mhathismonthandproductionto 14.9Mt.AccordingtosourcesinKazakhstan, farmersarefacingdifficultiesinobtaining financefortheircropsin2011/12because offinancialproblemscausedbylastyear’s drought.Also,thegovernmenthasbeguna programmetoboostfeedcropproduction, whichhasledtoafallinwheatarea.Ouryield estimateisunchangedthismonth.Wheat productioninKazakhstanisthereforerevised downby0.5Mtthismonthto14.9Mt. RainshavealleviatedthedroughtinAlgeria butthesituationremainsworrisomeinthe MiddleEast Wehaveslightlyincreasedestimatedwheat yieldinAlgeria,reflectingtheimpactofthe recentrains,whichalleviateddroughtwarn- ingsissuedonApril21.TunisiaandMorocco alsoreceivedrains,whichshouldassuregood harvestvolumes.Weestimatetotalwheat productioninNorthAfricaat18.4Mtin 2011/12upfrom16.1Mtin2010/11. EstimatedwheatyieldinIranhasalsobeenin- creasedbecauseofrecentrainfall.Production isrevisedupby0.6Mtto13.3Mt,although thisisconsiderablylessthanlastyear(14.4 Mt). RainsarrivedtolatetoofferrespiteinSyria andthereforeyieldremainsunchangedand willbelowerthanlastyear. CropsinTurkeybenefitedfromplentifulrains andwenowestimateitsharvestat18Mt,up1 Mtonlastyear. Weestimatetotalwheatproductioninthe MiddleEastat37.2Mtdown1.5Mtcom- paredwith2010/11. ProductioninNorthAmericareviseddown inresponsetocurrentbadweather Statcan’sreport,datedMarch2011,offarmers’ plantingintentionsinCanadapointstoa17 %increaseinspringwheatplantingscom- paredwith2010.Neverthelessinreality,sucha hugeincreaseisunlikely,becauseeventhough farmersmayintendtoincreasespringwheat areatothisextent,weatherconditionsarecur- rentlyverywet,andcombinedwiththehigh existinghumidityinthesoil,thiscouldrestrict plantings.ThesituationinCanadaappearsto beheadinginasimilardirectiontolastyear, althoughitistooearlytoestablishadefinitive negativeforecast.TotakeaccountofStatcan’s estimates,wehaveincreasedourforecastfor wheatareainCanada;neverthelessweproject anincreaseofonly12%(comparedwith17% forStatcan)to7.4Mha.WeestimateCanada’s harvestat25.6Mtupby2.4Mtcompared with2010/11andupby1.2Mtcompared withlastmonth. WheatproductionintheUSAisrevised downby1.1Mtthismonthto59.1Mt. Springwheatplantingsinthenorthernplains havebeendelayedbecauseofhighhumidityin thesoil.Wehavethereforereducedourplant- edareaforecastsincelastmonth,hencethe lowerproductionforecast.Therecentrainsin theHRW-growingstateshavebroughtsome respitetothecropsbutthesituationremains worrisomeinTexas,Oklahomaandpartsof Kansasbecausetherainsdidnotfallacrossall areaswherewheatisbeinggrown.In2010/11, thesethreestatesproducedaround40%of theUSwinterwheatharvest.Developments inthesestateswillthereforeneedtobemoni- toredcloselyinthecomingweeks.Giventhe beneficialimpactoftherainsinsomeplaces, wehaveneverthelessincreasedouryieldfore- castforwinterwheatthismonth(althoughit remainslowerthanin2010). China,IndiaandPakistanallanticipating goodharvests NorthernChinaremainsratherdrybutthe situationhasbeenwellmanagedthanksto goodrecoursetoirrigation.Despiteapos- siblereductioninyieldinthenorthernplains, wheatareainChinahasincreasedcompared withlastyearandproductionisforecastata similarleveltolastyear(115Mt).AsofMay6, significantrainfallwasforecastforthemiddle ofMay;theserains,assumingtheymaterialise, couldboostChina’sharvestoutlook. WeestimateIndia’sharvestat84.3Mt,upby Table3.9:worldwheatbalance(softanddurum) source:Stratégiegrains Table3.10:estimatedRussian,UkrainianandKazakhstanwheat balances source:Stratégiegrainsbasedonvarioussources
  • 29. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat balances 29 5 5,5 6 6,5 7 7,5 8 8,5 9 9,5 10 Mar-09 Jun-09 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Nov-10 Feb-11 May-11 May 2011 Jul 2011 Sep 2011 price (in $/bushel) carry-instocks production imports exports demand ofwhichfeed carry-outstocks USA 10/11USDA 26.6 60.1 3.0 34.7 32.1 4.6 22.8 11/12USDA 22.8 55.6 3.0 28.6 33.8 6.0 19.1 10/11 SG 26.6 60.1 3.0 35.6 32.0 5.6 22.0 11/12 SG 22.0 59.0 3.0 34.1 32.2 6.0 17.6 Canada 10/11USDA 7.8 23.2 0.4 16.5 8.7 4.0 6.2 11/12USDA 6.2 26.0 0.4 18.5 7.9 3.2 6.2 10/11 SG 7.8 23.2 0.0 15.1 8.0 3.4 8.0 11/12 SG 8.0 25.6 0.0 17.2 8.0 3.3 8.4 Argentina 10/11USDA 1.4 15.0 0.0 8.5 5.9 0.0 2.0 11/12USDA 2.0 13.5 0.0 8.0 5.9 0.0 1.6 10/11 SG 5.5 14.7 0.0 8.2 5.8 0.1 6.3 11/12 SG 6.3 13.4 0.0 8.2 5.8 0.1 5.7 Australia 10/11USDA 4.1 26.0 0.1 15.0 9.0 5.9 6.2 11/12USDA 6.2 24.5 0.1 15.0 8.5 5.4 7.3 10/11 SG 5.2 26.3 0.1 18.6 8.0 4.9 5.1 11/12 SG 5.1 24.7 0.1 17.6 6.8 3.7 5.5 Russia&Ukraine& Kazakhstan 10/11USDA 18.2 68.1 0.4 12.5 62.5 26.4 11.6 11/12USDA 11.6 87.0 0.3 26.0 60.1 23.7 12.8 10/11 SG 19.8 69.0 0.1 9.5 66.6 26.4 12.7 11/12 SG 12.7 87.6 0.5 23.8 66.0 24.6 11.0 EU27 09/10 SG 20.4 137.6 5.3 21.3 126.5 55.5 15.5 10/11 SG 15.5 135.5 4.2 22.0 123.1 50.7 10.1 11/12 SG 10.1 139.9 5.6 19.3 125.5 51.1 11.0 World IGC20/4 09/10 168.0 678.8 127.9 127.9 648.2 111.2 198.6 10/11 198.6 649.6 122.4 122.4 662.4 116.3 185.8 11/12 185.8 672.0 126.0 126.0 672.0 119.0 185.8 USDA11/5 09/10 166.2 684.2 134.7 134.7 654.3 119.2 196.2 10/11 196.2 648.1 124.2 124.2 662.1 122.8 182.2 11/12 182.2 669.6 125.7 125.7 670.5 124.2 181.3 SG 09/10 166.3 681.5 133.2 133.2 657.4 115.6 190.4 10/11 190.4 647.0 129.1 129.1 671.4 124.1 166.1 11/12 166.1 675.2 140.0 140.0 686.9 129.7 154.3 Graphic3.3:wheatfuturesattheChicagoBoardofTrade3.6Mtcomparedwithlastyear.Wheatstocks arenowatsuchahighlevelthatthegovern- menthasdecidedtoallowcontrolledstate-to- stateexportswithtwoneighbouringcountries AfghanistanandBangladesh. WeestimatewheatproductioninPakistanat 25Mt,upby1.1Mtcomparedwithlastyear. Pakistaniwheathasalreadybeguntotradeon theworldmarket,notablywithinAsiawhereit cancompeteformarketsharewithAustralian wheat. Nochangeforsouthernhemisphereharvests We estimate Australia’s harvest at 24.7 Mt downfrom26.3Mtin2010/11.Argentinean production is estimated at 13.4 Mt, down from 14.7 Mt in 2010/11. Wheat yields in both countries were exceptionally high in 2010/11andsuchresultsareunlikelytobe repeated this year. Therefore despite larger wheatareas,theirharvestsshouldbesmaller in2011/12. World demand still estimated at around 690 Mt; stocks estimated down due to smaller world produc- tion forecast World demand for soft wheat remains fore- castat687Mtin2011/12,upby15.5Mtcom- pared with the level of demand in 2010/11. The increase concerns demand for wheat for human consumption and industrial usage (+10 Mt) and the animal feed sector (+5.6 Mt). Sincelastmonth,wehavereducedourforecast forworlddemandforwheatinanimalfeedsby 1Mt,mainlyduetotheloweron-farmdemand forecast for the EU animal sector, in response to smaller harvest forecasts in some coun- tries. Nevertheless, global demand for wheat in animal feeds is still set to be higher than in 2010/11 on account of the tight world maize market.USmaize(oldcrop)iscurrentlymore expensivethanUSSRW(306$/tFOBforUS maizecomparedwith300$/tforSRW);with thearrivalofthenewUSmaizeharvest,maize moves back to a more competitive position (290 $/t FOB for November compared with 330 $/t wheat). However, as we mentioned last month, US maize is 10 $/t (FOB) more expensivethansoutheastEUwheat(Bulgarian and Romanian) and Ukrainian feed wheat. Thispricestructure,andthefactthatAustralia will still have feed wheat supplies to sell at the end of the summer, are factors that favour an increase in wheat consumption at the expense ofmaize. We now estimate global wheat stock at the end of 2011/12 at 154 Mt; it has decreased Table3.12:worldwheatbalance(softanddurum)formainexporting countries source:USDA/IGC/Stratégiegrains(SG)forEU27and2011/12estimates
  • 30. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat balances 30 60 110 160 210 260 310 360 410 15 20 25 30 35 40 45 75/76 81/82 87/88 93/94 99/00 05/06 11/12 wheat ratio [stocks-to-use] SRW wheat quoted prices ratio (%) price in current dollar since last month due to the reduced produc- tionforecasts. We estimate that world wheat stocks will de- creaseby12Mtduringcropyear2011/12and ending stock will equate to 22.5 % of annual globaldemand(downfrom24%forecastlast month). The outlook for the world soft wheat market in 2011/12 has therefore tightened since last month. Nevertheless at this stage of the crop year, variations to production estimates of one or several Mt may only be temporary. An improvement in weather conditions would be all that is required to generate a sharp up- swing to our production forecast; conversely, the forecast could decrease more if there are further weather-related problems. Conditions through the coming months will crucial in the formation of yield potentials in the main wheat-producingcountries. World wheat trade 2010/11 and 2011/12 2010/11: exports from Brazil, Argentina and Ukraine revised up but EU and North American exports revised down Worldsoftwheattradeestimatedat108Mt Estimated total soft wheat trade in 2010/11 has not changed this month and is estimated at 108 Mt (table 3.11), down 5 Mt compared with 2009/10. We estimate total trade in soft wheat,hardwheatandflourat129Mt. Since last month, to take account of the latest dataforshipmentsandsales,wehaveincreased our import forecasts for North Africa (+0.6 Mt), and Turkey (+0.4 Mt) but reduced our importforecastsforYemen(-0.2Mt)andIran (-0.7 Mt). Iran has not imported any wheat at all so far in 2010/11; it therefore has an ex- tremely low level of ending stock. Given that its2011harvestisforecasttobelowerthanits 2010 harvest, we envisage that it will need to import a significant volume in 2011/12. We previouslythoughtitlikelythatIranwouldbe- ginimportingwheatinspring2011;however, given that it has so far purchased no wheat at all, we have cancelled our forecast for any im- portsinthelastmonthsofcropyear2010/11. On the export side, we have increased our export forecasts for Ukraine (+0.2 Mt), Argentina (+0.1 Mt) and Brazil (+0.7 Mt) at the expense of EU exports (-0.3 Mt), US ex- ports (-0.5 Mt) and Canadian exports (-0.1 Mt). SmallreductionforprojectedEUexports We currently estimate EU soft wheat exports on the world market at 19.1 Mt (see table 3.13) and total wheat exports (including du- rum wheat and flour) at 22 Mt. Soft wheat exports are revised down by 0.3 Mt reflecting increased exports from Brazil and Ukraine. Projected EU exports have decreased by 0.1 Mt to Tunisia, 0.1 Mt to sub-Saharan Africa, and0.2MttoYemen.Bycontrast,wehavein- creased our forecast for EU exports to Algeria by0.2Mt.Intermsofnationalexportvolumes, thereductionimpactsonGermany(-0.3Mt), the Baltic countries (-90 kt), Netherlands (-60 kt) and Sweden (-50 kt). By contrast, French exports are revised up by 0.2 Mt (mostly des- tinedforAlgeria). May 3 2011, export licence fixations at the European Commission totalled 16.8 Mt. To reach our forecast of 19.1 Mt, export licence fixationswillneedtohitarateof0.290Mtper weekbetweennowandtheendofJune(which issimilartotherateseeninrecentweeks). 2011/12: global wheat trade still forecast higher but projected EU exports reduced this month to reflect smaller EU harvest forecast We still forecast that world soft wheat trade willincreasesharplyin2011/12(+11Mtcom- pared with 2010/11), see table 3.11. As previ- ously highlighted, this increase stems from severalfactors:  Lower harvest forecasts than last year in severalimportingcountries–thisisthecase intheMiddleEast,notablyinIran,whose importrequirementisforecastupby3Mt, Syria(+1Mt),andSaudiArabia(+0.3Mt); we estimate that the total import require- ment for the Middle East countries will increaseby6Mtcomparedwith2010/11;  Higher animal sector demand for wheat at the expense of maize – for this reason, wheatimportsinthecountriesofSoutheast Asiaareforecasttoincreaseby3Mt;  Higher demand for wheat for human consumption–thisissettoriseinlinewith the changes recorded in previous years and theneedtoreconstitutestockholdings(re- duced to very low levels in 2010/11); this explainstheincreasedimportneedforsub- SaharanAfrica;  Possibility of increased imports in the EU: the rise in export availabilities in the Black SeacountrieswillmeanthattheEUcanin- creaseimportvolumesby1.6Mt. By contrast, we no longer forecast an increase inimport needsfor NorthAfrica, despite the projected increase in internal demand; this reflects the good harvest outlooks for these countries. Given this rise in import requirements, we forecast sharp increase in export volumes from the Black Sea countries compared with 2010/11. On the basis of our current production forecasts, we estimate combined exportsfromUkraine,RussiaandKazakhstan at24Mtin2011/12,upfrombarely10Mtin 2010/11. We estimate that Canada will increase its ex- portsby2.9Mtassumingthatqualityimproves and harvest volumes increase somewhat. We forecastArgentineanexportsatthesamelevel as in 2010/11. By contrast, we envisage that Australia will export slightly less (-1.3 Mt) than in 2010/11 because its harvest is set to be smaller than in 2010. Meanwhile in India, debateisragingoverwhetherornottheexport ban should be lifted, given the high level of stocks.Indiahasjustannouncedthatexportsto severalneighbouringcountrieswillresume(see above). However, internal demand is growing veryquicklyinIndia(+4Mtbetween2010/11 and 2011/12) and thefearof inflation weighs heavily in this country. We therefore do not thinkthatIndiawillplayamajorexportingrole on the world market in 2011/12; it could ex- Graphic3.4:changesinworldwheat stocks(includingdurumwheat)
  • 31. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat balances 31 changein exports changeinimportrequirements 09/10 10/11 11/12 ∆ 09/10 10/11 11/12 ∆ EU27 19.1 19.1 16.9 -2.2 EU27 3.1 2.3 3.8 1.6 Pakistan 0.0 0.6 0.5 -0.1 Europe(EU,CISexcl.) 1.5 1.5 1.4 -0.1 Turkey 2.5 0.1 0.6 0.4 CIS 0.1 0.3 0.6 0.3 USA 22.6 33.7 32.1 -1.5 N&C.America 7.2 7.1 7.1 0.0 Canada 14.1 11.1 14.0 2.9 SouthAmerica 10.6 12.0 11.9 0.0 Australia 13.5 18.4 17.2 -1.3 Iran 2.7 0.0 4.1 4.1 Argentina 4.0 8.2 8.2 0.0 Jordan 0.8 1.0 1.1 0.1 Ukraine 9.2 3.4 9.7 6.3 Yemen 2.6 2.5 2.7 0.2 RussianFed. 18.4 3.4 8.9 5.5 Turkey 3.0 3.2 2.0 -1.2 Kazakhstan 4.4 2.7 4.9 2.2 OtherNeareastAsia 13.0 10.3 12.6 2.4 China 1.4 1.1 1.5 0.3 China 1.4 1.1 1.2 0.2 Syria 0.0 0.0 0.0 0.0 India 0.3 0.1 0.0 -0.1 Others 3.6 6.1 4.1 -2.1 OthersFareastAsia 30.1 31.8 35.0 3.2 Total 112.9 108.0 118.5 10.5 NorthernAfrica 18.5 21.1 19.7 -1.4 OtherAfrica 14.7 11.9 14.2 2.3 Others 3.2 1.8 1.0 -0.8 Total 112.9 108.0 118.5 10.5 kt 2007/08 2008/09 2009/10 2010/11 2011/12 West.Eur.(nonEU) 508 572 662 625 648 East.Eur./Balkans(nonEU) 399 444 226 379 292 Turkey 548 693 109 537 507 CIS 18 69 3 48 65 Morocco 2133 2916 1375 2685 2400 Algeria 2361 4025 3538 4024 3124 Tunisia 342 245 153 487 425 Egypt 175 1522 1954 2593 1535 Libya 235 484 957 546 465 otherAfricaofwhichACP 1730 3844 5407 2834 2857 America 140 297 491 581 520 ofwhichCuba 0 152 277 580 520 Iran 0 1875 604 0 500 Iraq+Jordan 1 570 115 450 350 Yemen 237 857 905 702 820 Bangladesh 17 56 1 573 160 S.Korea 0 0 0 546 150 China 0 51 0 0 0 otherAsia 437 2709 2511 1506 1890 Oceania 0 0 0 0 0 miscellaneous 8 355 50 1 100 total 9288 21585 19062 19117 16806 portasmallvolumetoneighbouringcountries butwedonotexpectthesetoexceed1Mt. Given the rise in projected Turkish wheat production, Turkey should also be viewed as a potential exporter on the world market in 2011/12 (we estimate exports at between 0.5 and1Mt). In this context, we continue to envisage that exports from the USA and the EU — the two exporters able to offer residual supplies when needed to plug gaps as a last resort on the world market — could decrease slightly in 2011/12. We currently estimate that com- bined US and EU exports will decrease by 4 Mt. However, since last month, despite the very strong position of EU wheat against US wheat, we have increased our forecast for US wheat exports in 2011/12 at the expense of EUexports(-2.1Mt).Thisdeclinestemsfrom areassessmentofEUexportavailabilityfollow- ing this month’s reduction to the EU harvest forecast. EU exports are now forecast at 16.8 Mt which means that the EU would end the crop year with stocks close to the minimum stockrequiredtocomfortablysupplythemar- ket until the next harvest arrives. We have not reducedourexportforecasttoagreaterextent thanthisbecauseEUwheatispotentiallycom- petitiveagainstUSwheat. Inthelightofsmalleravailabilitiesandreduced import needs in certain African countries, we have reduced our forecast for EU exports to Africa (-0.9 Mt to Algeria, -500 kt to Egypt, -400 kt to Libya and -400 kt sub-Saharan Africa). We can conclude by saying that the EU will need to maintain a high level of exports on the world market, although it will be slightly lessthanin2010/11giventhatonthebasisof currentharvestforecasts,itwouldbeunableto shipthesamelargevolumeasin2010/11. N.B:Subscriberstothe“Exports”moduleat ourwebsitestrategie-grains.comcanconsultthe fulllistofimportandexporttransactionsonthe worldmarketandthebreakdownofourEU exportforecastsfor2010/11and2011/12into suppliercountriesandshipmentdestinations. Table3.11: worldimportrequirementsforsoftwheat(excluding products)andprojectedexports– Mt—July-June source:Stratégiegrains Table3.13:EU27wheat(grain)exporttothird countriesbymaindestinations
  • 32. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union wheat balances 32 Wheat,May2011 grossinter- ventionprice delivered price ex farm/works %int. price %int. price Germanymillingwheat(B,12%) €/t 101.3 255.0 252% 245.0 242% Germanyfeedwheat €/t 241.0 238% 220.0 217% Denmarkmilling wheat DKK/q Denmarkfeedwheat DKK/q Francemill.wheat(Hg220,prot11%),b.July €/t 92.0 227.5 247% France76/15/4/2/2,basisJuly €/t 92.0 226.0 246% Francenon-millingwheat,basisJuly €/t 92.0 210.0 228% UnitedKingdombreadwheat £/t 89.5 UnitedKingdommillingwheat £/t 89.5 UnitedKingdomfeedwheat £/t 89.5 201.0 224% Spainmillingwheat €/t 101.3 250.0 247% Italy €/t 101.3 theNetherlands €/t 101.3 236.0 233% Hungarymillingwheat €/t 101.3 196.3 194% Hungaryfeedwheat €/t 101.3 179.3 177% Sweden SEK/q 91.4 Finland €/t 101.3 Analysis of ending stocks and conclusion Outlooks remain tight in the EU for 2010/11 and 2011/12 but timing of ex- ports and price changes will depend on situation in Black Sea countries Table3.14:comparisonsofnewcropopenmarketand interventionprices(06/05/2011) TheinterventionpriceusedisforMay2011 Cropyear2010/11 We estimate ending stock on June 30 2011 at 8.7 Mt.Itremainsclosetothelevelforecastlast monthbecausethedecreaseinexportsandrise inproductionhaveoffsettheincreaseininter- naldemand. As stated last month, this ending stock level of 8.7 Mt is extremely low: it is 2 Mt less than the minimum stock required to comfortably supply the market until the next harvest ar- rives. The situation is particularly tight (with a significant difference between expected and normal stock levels) in France, Britain, central Europe (Hungary and Poland) and southeast Europe (Romania/Bulgaria). Germany’s bal- ance has tightened since last month following an increase to internal demand. This situation should prevent old crop prices falling sharply even though the likelihood of Russia and Ukraine returning to the market increases fromJulyon. Cropyear2011/12 Crop year 2011/12 will begin with a much lower level of opening stock than crop year 2010/11(downalmost5Mtaccordingtoour current forecasts). We still forecast an increase inwheatproductioncomparedwith2010/11, although on a smaller scale than last month (+5.2 Mt compared with +9 Mt last month). Imports from third countries are forecast to increase by 1.6 Mt. In total, wheat supply in 2011/12 is forecast to rise by around 2 Mt comparedwith2010/11. Internal demand is currently forecast to in- creasebyaround3Mt.Totaldemandisthere- fore set to rise more sharply than supply and thus EU export availability is now estimated lowerthanin2010/11. Our analysis of world import needs, export availabilitiesandcompetitionbetweenthevari- ous origins indicates that the EU will need to export16.8Mtofwheatontheworldmarket in2011/12. The world market will effectively require the EU’s entire export availability in 2011/12. Therefore the outlook for EU wheat is not heavy and stocks are forecast to stay low at theendof2011/12.Generallyspeaking,this situation should support EU wheat prices. Thefactthattheoutlookontheworldmar- ket is fairly tight with relatively low stock forecastsisasecondsupportfactor. Nevertheless, wheat prices in the EU will be heavily influenced by the export policies ad- opted in Russia and Ukraine. If exports from thesecountriesontotheworldmarketresume inJuly-August,theshort-termoutlookforEU priceswillbebearish.However,oncetheshock of their return to the market has passed and once a regular pattern of exports from these countries is re-established, the EU will still need to export all its availabilities. This means thatEuropeanpriceswillthenhaveanincrease potential. If Russia and Ukraine do not resume exports until the autumn (from October), then EU priceswillhaveanincreasepotentialduringthe summerbeforeapossibledecreasepotentialat thetimewhentheBlackSeacountriesreturnto themarket(wenolongerbelieveitislikelythat they will postpone their return until January 2012).EvenifEUpriceseaseinthenearterm, we can assume that they will increase again in thesecondhalfofthecropyeargiventhescale of world demand for EU wheat. Any increase at that stage would be influenced by the situa- tionontheworld maizemarket.Ifmaizepro- duction in the USA does not reach the level of our current forecast, the maize market will extremelytight:inthiscase,arisingmaizeprice willintensifyupwardpressureonwheatprices. If the US maize harvest meets or exceeds our current forecast, the world maize market in 2011/12 will be less tight than it appeared last month: this is also because maize areas in RussiaandUkrainearenowsettobeveryhigh, meaning that the Black Sea countries should nowbeabletoexport10Mtofmaizeontothe worldmarket.Inthiscase(goodmaizeharvests in USA and Black Sea), upward pressure on maize prices should be restrained in 2011/12, whichinturnwilllimitbullpressureonwheat prices.However,thislatterscenarioisfarfrom acertaintyatthisstageduetotheslowpaceof maizeplantingsintheUSA.
  • 33. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union barley balances European Union barley balances 33 Crop year 2010/11 Little change this month for production, imports and exports. Demand for barley for human consumption and industrial usage has been revised down this month, whilst projected barley usage in animal feeds increases. As of May 6, 2.5 Mt of barley had been sold from inter- vention via traditional tendering (out of total estimated sales by June 30, 2011 of 2.7 Mt) and 1.6 Mt via the food aid programme (out of total estimated sales of 2.2 Mt by June 30, 2011). The volume of intra-EU barley trade is estimated up to 10 Mt to take account of the latest customs statistics. We now estimate a barley surplus of 2.5 Mt (over the level of stock required to comfortably supply the market until the next harvest arrives) on June 30, 2011, mainly split between Germany, France and Poland. This should exert downward pressure on old crop prices. Crop year 2011/12 EU barley production in 2011/12 is revised down by 0.3 Mt this month to 54.2 Mt, which is 1 Mt more than in 2010. The reduction since last month reflects the impact of the dry weather on barley yields. We estimate malting barley production at 11 Mt (up from 10 Mt in 2010/11). Demand for barley for human consumption and indus- trial usage should slightly increase to 11.4 Mt reflecting increased demand for malting barley and on a smaller scale, increased demand for barley in bioethanol pro- duction. Demand for barley in animal feeds is set to fall by 1.7 Mt in 2011/12 to 39.1 Mt; the decline is due to barley’s less competitive position in industrial feeds (demand trans- ferred to wheat and maize). Intra-EU barley trade is set to be sharply down on the level of 2010/11, due to higher domestic availability in Spain and lower projected animal sector demand in the Benelux. We currently forecast that world barley production will increase by 11 Mt, which will offset the reduction in stocks at the beginning of 2011/12. Consequently, with world demand set to increase by 5 Mt, the outlook for the world barley market in 2011/12 is tight. Barley trade on the world market is set to remain close to the level of 2010/11 at 14.6 Mt. This month we publish our first breakdown of estimated EU exports on the world market by destination countries; we estimate total EU exports at 3 Mt (down from 5 Mt in 2010/11). This level represents almost all the EU’s exportable surplus (estimated at 3.5 Mt). Hence EU barley supply and demand in 2011/12 is al- ready looking set to balance, except in the east EU coun- tries. This outlook is neutral in terms of new crop barley prices. The reduction in world demand addressed to the EU (due to the rise in Ukrainian availabilities) will be one of the most important factors in terms of limiting the in- crease potential for EU barley prices. On the other hand, prices have little potential for decrease due to the tight (or at least finely balanced) outlooks for EU wheat and maize supply and demand. Malting barley production is still forecast 1 Mt up on the level of 2010. However, if the dry conditions persist, barley yields could face further reductions and quality could also be affected. The outlook for malting barley in 2011/12 is therefore set to be tighter than in 2010/11. The malting barley premiums have increased sharply since last month, reflecting concerns over the lack of rainfall in recent weeks. The premiums are now high and will have little potential for decrease until rains return. Formethodologyseeopeningcommentaryinwheatsection. Supply and internal demand Small increase for barley usage in animal feeds in 2010/11 but sharp reduction for 2011/12 (-2 Mt) Crop year 2010/11 Production NochangetoestimatedEU27barleyproduc- tion at 52.9 Mt (last year: 61.8 Mt); malting barley production remains forecast at 10 Mt (lastyear:14.5Mt). Imports Nochangethismonthtoestimatedbarleyim- portsat30kt(lastyear:100kt). May 3 2011, import licence fixations at the EuropeanCommissiontotalled25kt(upfrom 25 kt a month ago and compared with 91 kt forthesameperiodin2009/10). Demand for barley for human con- sumption and industrial usage Demand for barley for human consump- tion and industrial usage is revised down by 0.2 Mt this month to 11.1 Mt (the same as in 2009/10). The reduction stems from a lower forecastforbarleyusageinbiofuelproduction (downfrom0.51to0.37Mt),mostlyinSpain. Nochangethismonthforbarleyusageinmalt productionat10Mt(thesameasin2009/10). N.B:SubscriberstotheEUBiofuelsmoduleon ourwebsite,strategie-grains.com,mayconsultthe fulllistofbioethanolrefineriesandproduction capacities,andabreakdownofbiofueloutput volumesbycountryandcropyear.
  • 34. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union barley balances 34 2011/12 total productionmalting% maltingbarley production maltingbarley demandsurplus/deficit spring barley winter barley spring barley winter barley spring barley winter barley total spring barley winter barley total spring barley winter barley total Ger.1672778156%1%93886102419961822178-1058-96-1155 Bel/L3434820%77500357857-493-357-850 Den.255873639%1009100927302737350735 Spn.917018%73173152605262050205 Fra.2769709670%22%192615833509766754152011608291989 Gre.02550%0040040-400-40 Irl.89424826%23423410901091250125 Ita.010620%5%05555088880-33-33 Neth.1852481%150015032644370-176-44-220 Por.0660%0682795-68-27-95 U.K.2967230350%26%148960920991174567174131543358 Aust.28543635%7%1003113117125196-716-64 Fin.1747015%25825813301331250125 Swed.14137620%280280205020575075 Pol.28916517%19419447918496-285-18-302 Hun.34068741%14014018413197-44-13-57 Cz.R.115050044%50950955218570-43-18-61 Slk.3435446%42%1592318216737204-8-14-23 Est.30239%282830326026 Lat.268179%252532032-60-6 Lit.9684011%1041049409410010 Sln.14620%00000000 Cyp.0400%00000000 Mal.030%00000000 Rom.33476223%12%7890168408812738241 Bul.515900%22%013213201321320-0-0 EU 15236962043330%12%7121236494866286204383298353211157 EU25299712249028%11%8281238710668779621289925485259744 EU27303562384228%11%83592609109687836234810184523261784 2010/11 total production malting% maltingbarleyproduc- tion maltingbarleydemandsurplus/deficit spring barley winter barley spring barley winter barley spring barley winter barley total spring barley winter barley total spring barley winter barley total 1694855251%1%8649595919641492113-1099-54-1154 3238419%66491348839-485-348-833 220278930%66166126002604010401 697512548%5315315230523808 2541755976%24%193717913728832819165111059722077 02220%0039039-390-39 91723225%22922910701071230123 09900%5%05050086860-36-36 1693675%126012632240363-196-40-236 0750%0672693-67-26-93 2810243451%26%143363820711174567174125972331 31746129%7%923312516923192-7710-67 1340010%1341341300130404 11448520%229229201020128028 27308157%18518543918457-254-18-272 30765935%10710716013173-53-13-66 108949637%40240249718515-95-18-113 3404840%40%1361915516737204-31-18-49 25029%2121-00-022022 184279%161628028-120-12 5113711%555592092-370-37 14650%00000000 0360%00000000 030%00000000 297102310%10%301021324288129-12153 247410%10%07474079790-5-5 201402307331%11%624226088850627720598337-35549513 255652526128%10%716426279791766121459805-497483-14 258872702528%10%7194280499977702231110014-509492-16 Table4.1:estimatedEUmaltingbarleyproduction(2011/12and2010/11)
  • 35. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union barley balances 35 July-June 2011/12 carry-instockimportsfromgrainsexportsto overseas usage hum/ind.consumptionanimalfeed intervention stock carry-out stock free stock requirement intervention free total production of which: ex-farm sales EU 27 non-EU supply EU 27 non-EU total biofuels internal consump. total compound feed on-farm feed seeds and waste demand free stock surplus/deficit Ger.259149517549453531218390130461152510025072162291747621315346419120641438399820842 Bel/L75057382149801937170700857085777748529216188904848049 Den.-0538538329521004042425260027302732442105613852143614-04294290427 Spn.-0140140917167110999284127942685268362402343396009852-01401400143 Fra.-0139013909866829094011350393210703915220152236961603209333310591-07597580763 Gre.0818125515061548000400403931172764247507373077 Irl.0676711431800139024001090109110876434383132306767067 Ita.011111062750331856608808816871454233681849077010 Neth.097972091706020125610003700370139013405017193307979079 Por.05757663880510450095095357337201150703306 U.K.499299652701203638961330017420174230068272178164555448318350834 Aust.061617212761920974690193918556514142511694303030030 Fin.187087117477026251907003260326135128110701022039058558660529 Swed.167187149053016302602001950195945169776591479161341510137 Pol.7450257635421860430412530084108412487331215636038431460461120343 Hun.661592251027130126631730020102014741001121121321440133 Cz.R.282362641650220193527605700570827418409104177701581580154 Slk.3161913971180607510277027714762537165571059 Est.7222930423035777100310311772632003737033 Lat.-01414285620361966004104111468463334401717020 Lit.112112110081301143115800430435967352288922122022160161 Sln.01414763501255004704752745611001515012 Cyp.099401405624500000234023401111012 Mal.000329032000003003002200 Rom.1242643810969001624273480012701272941841359-026526517099 Bul.920221164150857236160013201321227572501311318049 EU 1528859186206441287857108582997025213051911049386173355322445411316440234187603993 EU2549370577550524618500164686758086234051111624931066938690302263350194513153252404919 EU2751576848199541988594164711558594298051114214931092839106328265434194552757214905068 Table4.2:EU27barleybalanceJuly-June2011/12(kt)
  • 36. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union barley balances 36 July-June 2010/11 carry-instockimportsfromgrainsexportsto overseas usage hum/ind.consumptionanimalfeed intervention stock carry-out stock free stock requirement intervention free total production of which: ex-farm sales EU 27 non-EU supply EU 27 non-EU total biofuels internal consump. total compound feed on-farm feed seeds and waste demand free stock surplus/deficit Ger.1826121330401024759331813015099142511620240417922257735221755186191334525914951754620871 Bel/L351641994161539021541751550839083991363727516209875057053 Den.6014151475299121004675461632026002602570121813522144137-053853890443 Spn.-0943943822981209984102125126951805158310445738536009844-01401400141 Fra.88722533140101008327130713377428014103016573165342781988228933311987-013901390530859 Gre.075752222697574100390394111302814249308181080 Irl.0717111492520147221001070107119388031383140406767071 Ita.08899089391900710860861728156816068189001111010 Neth.01001002042320026253926003630363184917975217252809797098 Por.011411475372056112093093388364241150405757506 U.K.155143715925244792691774311001742017423163945221716459214992996130861 Aust.4111916077827715401093912019091816461654811031031061613032 Fin.7976921488134090283814911003230323132325310706219671870871360508 Swed.2011893901228300164826814601910191898220678591561167187-60131 Pol.366350715354516404424138500802080224984422056360384874502576160341 Hun.4101025119662901506543520178017840810012816615922540118 Cz.R.3022675691585260218040830515051588643645110419162823626480154 Slk.17113430538840073414520277027715762643316191060 Est.753911425340370134350310311162634172229025 Lat.231942211135038889110037037115645123374-01414018 Lit.1531392925481708571875041041414793358873611211210120 Sln.099793401237004704748741610901414011 Cyp.01010362253274000002650265099013 Mal.022323028000002802800000 Rom.619615813213940187231543601290129370184143412426438310112 Bul.50459676547090928314707907911375698920221116040 EU 1540018794127964321388822664917777341134289873718617354052391587112885918620617504166 EU255501986415365508269580297580194244370421091537110544403413159682514937057755020305027 EU275613100061561952912100222978582100224954421112437110753408233419703835157684819925005179 Table4.3:EU27barleybalanceJuly-June2010/11(kt)
  • 37. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union barley balances 37 2010/11 Foodaidforthemost deprivedpersons(2011 calendaryear) Hypothesisofresaleasfood aidforthepoorthroughout 2010/11 ofwhichtransfersoffoodaidforthepoorto othercountries Resalevianormaltendering processontointernalmarket Resalevianormaltendering processasofMay6 Ger. 583 466 466 1101 1070 ofwhich31kttoBelgium,110kttoItaly, 61kttoPoland B/L 35 28 0 0 0 Den. 0 0 0 60 60 Fra. 837 817 294 70 70 ofwhich244kttoSpain,50kttoPortugal, 0.25kttoIreland U.K. 0 0 0 151 141 Aust. 20 20 20 22 21 ofwhich11kttoSlovenia,5kttoMalta Fin. 39 31 0 784 705 Swe. 0 0 0 148 81 Pol. 365 292 0 1 0 Hun. 269 215 201 30 31 ofwhich71kttoGreece,130ktto Romania Cze. 146 117 117 136 137 ofwhich46kttoRomania Slk. 76 60 46 80 80 ofwhich46kttoBulgaria Est. 35 28 28 40 40 ofwhich28kttoLatvia Lat. 23 18 0 5 0 Lit. 61 61 0 91 91 Rom. 61 49 0 0 0 Bul. 42 34 0 8 0 EU 2591 2237 1172 2728 2526 Demand for barley in animal feeds Demand for barley in animal feeds is revised upby0.2Mtto40.8Mt.Thisincreasereflects barley’simprovedcompetitivepositionforthe lastmonthsofcropyear2010/11inmostEU countries, although not Germany, Benelux or Spain. Demandforbarleyinanimalfeedsisnowfore- cast0.8Mtdownonthelevelof2009/10. Resale programme for barley inter- vention stocks Resaleasfoodaidforthepoor Sales of intervention barley for the food aid programmetotalled1.6MtonMay62011,in- cluding0.8MtinFrance,0.4MtinGermany, 0.2 Mt in Poland and 0.1 Mt in Lithuania. Given these levels, we have increased our fore- cast for intervention barley sales in 2010/11 (table4.4,thirdcolumn)notablyinthecaseof France(from0.75to0.82Mt).Weestimatethe totalEUsalesofinterventionbarleyinthispro- grammeasofJune30,2011at2.2Mt. Weestimatethatthosequantitiesremaining unsold on June 30 will be sold in crop year 2011/12;thisvolume(350kt)thereforeap- pearsonthebalancesheetfor2011/12. Resaleofinterventionbarleyontointernal marketviatraditionaltendering Sincelastmonth,90ktofbarleyhasbeensold by the traditional tendering process, including 30ktinBritain,20ktinFinlandandSweden, 10ktinGermanyand10ktinCzechRepublic. A total of 0.2 Mt remains to be sold via this programme before June 30(see table 4.4, right handcolumn). Wearestillworkingonthebasisthatallremain- ingstocksallocatedtotheprogramme(0.2Mt) willbesoldbacktotheinternalmarketbefore theendofJune302011. Crop year 2011/12 Production EU barley production in 2011/12 is esti- mated down 0.3 Mt this month to 54.2 Mt (compared with 52.9 Mt in 2010/11). The reduction reflects lower yield forecasts for sev- eralcountriesfollowingtherecentdryweather, notably in Germany (-0.4 Mt), France (-0.4 Mt),andBritain(-0.1Mt).Thisispartlyoffset by an increase in barley production in Spain (+0.4 Mt reflecting the good levels of rainfall in April) and in Lithuania (+0.3 Mt, reflect- ing the transfer into spring barley production of area where autumn-planted crops did not survivethewinter). Thereductioninbarleyproductioncompared withlastmonthmostlyconcernswinterbarley (-0.8Mtto25.2Mt);springbarleyproduction isrevisedupby0.5Mtthismonth(to29Mt) on account of the increases for Lithuania and Spain mentioned above. Winter barley pro- duction is now forecast 1.8 Mt down on the level of 2010/11 whilst spring barley is set to increaseby3Mt. Barley yields will be greatly influenced by weather conditions in the next few weeks. In effect, rains are urgently needed in order for yields to match our forecasts, in the cases of bothwinterandspringbarley. Estimated malting barley production remains very close to last month (-40 kt) at 10.97 Mt (compared with 10 Mt in 2010/11) because the fall in winter malting barley production (-100 kt to 2.6 Mt compared with 2.8 Mt in 2010/11) is offset by the increase in spring malting barley production (+60 kt to 8.4 Mt Table4.4:forecastforresaleofinterventionbarleyin2010/11(kt)
  • 38. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union barley balances 38 comparedwith7.2Mtin2010/11). Thedryconditionsofthelastfewweekscould impact on protein content levels in the grains, because nitrogen absorption by the plants mightoccurlaterthanisideal(whichtendsto resultinhigherproteinlevels).Ourforecastfor malting barley production will be reduced if proteincontentistoohigh. Imports Weestimatebarleyimportsin2011/12at200 kt, based on the assumption that the EU will not need to import the full 306 kt quota be- cause domestic availabilities will be sufficient. Imported barley should nevertheless remain attractive in Greece, and Cyprus, and possibly Romania and Bulgaria. This import forecast willbeadjustedtoreflectspreadsbetweenEU and Russian/Ukrainian barley; this point will be reassessed once new crop barley prices are quotedforBlackSeaexports. Demand for barley for human con- sumption and industrial usage Demand for barley for human consumption andindustrialusageisestimatedat11.4Mt,up 0.3 Mt compared with the level of 2010/11. Theincreaseonlastyearconcernsthemaltsec- tor (+0.2 Mt to 10.2 Mt) and biofuels (+0.1 Mtto0.5Mt). Sincelastmonth,wehavereducedourforecast by0.2Mttoreflectareductioninestimatedde- mandforbarleyinbiofuelproductioninSpain (demandtransferredtowheatandmaize). N.B:SubscriberstotheEUBiofuelsmoduleon ourwebsite,strategie-grains.com,mayconsultthe fulllistofbioethanolrefineriesandproduction capacities,andabreakdownofbiofueloutput volumesbycountryandcropyear. Demand for barley in animal feeds Little change since last month: demand for barleyinanimalfeedsin2011/12isestimated at 39.1 Mt (+0.2 Mt). Projected demand for barley in industrial feeds has declined slightly since last month (due to barley’s less competi- tivepositioninSpain,FranceandNetherlands) but this is mostly offset by an increase in es- timated on-farm barley usage in Spain and Lithuania (reflecting larger harvest forecasts forbothcountries). Demandforbarleyinanimalfeedsisnowfore- cast1.7Mtdownonthelevelof2010/11due to barley’s less competitive position for inclu- sion in industrial feeds compared with wheat and maize. The reduction compared with 2010/11 will mostly concern the Benelux, France (-0.6 Mt each), Germany (-0.3 Mt) andUK(-0.2Mt).Bycontrastdemandisfore- cast to increase in Lithuania (+0.2 Mt) and Hungary(+0.1Mt). Intra-EU barley trade 2010/11: trade volume estimated up – 2011/12: large reduction forecast Crop year 2010/11 Wehaverevisedthevolumeofintra-EUbarley trade in 2010/11 up by 0.2 Mt this month to 10 Mt (9.3 Mt in 2009/10), reflecting the lat- est customs statistics. To reflect recorded ship- ments so far, we have increased our import forecasts for Germany (+60 kt), Italy (+60 kt),Portugal(+80kt)andRomania(+40kt). Thisispartlyoffsetbyareductioninprojected importsinSpain(-50kt)andtheNetherlands (-100kt). On the export side, these changes generate increased export volumes from Germany (+60 kt), Finland (+50 kt), Estonia (+40 kt), Belgium and Spain (+30 kt). By contrast, we havereducedourforecastsforexportvolumes fromRomaniaandBulgaria(-40kteach). Crop year 2011/12 Thevolumeofintra-EUbarleytradeisforecast sharplydownonthelevelof2010/11;wenow forecast an even greater reduction in the trade volume than last month due to the increase in estimated barley availabilities in Spain and thelowerlevelofanimalsectordemandinthe Benelux. We now envisage a 0.7 Mt reduction in the Benelux import requirement compared with 2010/11duetothelowerlevelofanimalsector demandinthesecountries,a0.3Mtreduction for Romania and smaller declines for Spain, Greece and Italy (-0.1 Mt each). In 2010/11, the transfers of intervention stock subsequent to the food aid programme were counted as part of intra-EU barley trade. This led to a sharpriseinimportvolumesinRomania(+0.3 Mt). We forecast that Romanian imports will returntonormalin2011/12. Given these smaller import needs, shipment volumesfrommostoftheexportingcountries are set to be lower than last year, with particu- larly significant reductions from France (-0.35 Mt), Germany (-0.3 Mt) and Hungary (-0.2 Mt). N.B:Subscriberstoouronline“Intra-EU Trade” webmodulecanconsultthefullbreak- downofintra-EUbarleytrade(including recordedandprojectedvolumesforeachcountry) atourwebsitestrategie-grains.com. World barley market Tighter outlook Malting barley prices increase Feedbarley Feed barley prices have not changed greatly since last month: French feed barley was trad- ing at 188 €/t FOB Rouen on May 6, or 274 $/t(lastmonth;188€/tand270$/t). French new crop feed barley is also trading at 186€/tFOBRouenforOctober(271$/t).It istherefore7 €/t cheaperthanold cropbarley (spot price plus cost of storage between now andOctober2011). ThefirstpricesfornewcropUkrainianbarley have now appeared, ranging from 240 to 255 $/t. Australian feed barley was trading at 260-265 $/t FOB Newcastle old crop (the same as last month)and260-265$/tnewcrop. Maltingbarley Malting barley prices have risen sharply since lastmonth:+28€/tforoldcropspringmalting barley to 233 €/t FOB Creil or 338 $/t; +27 €/tfornewcropwinterto226€/tforOctober, and+35€/tfornewcropspringto254€/tfor October. The malting barley premiums (difference be- tween malting barley and feed barley prices)
  • 39. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union barley balances 39 origins destinations 2011/12 Ger. B/L Den. Spn. Fra. Gre. Irl. Ita.Neth. Por. U.K. Aust. Fin. Swe. Pol. Hun. Cze. Slk. Est. Lat. Lit. Sln. Cyp. Mal.Rom. Bul. EU Ger. 27 100 89 40 0 13 135 568 39 7 43 0 4 73 0 2 0 0 0 1 0 6 3 1 0 1152 B/L 11 0 0 7 0 0 0 151 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 170 Den. 306 10 7 3 0 5 0 45 4 22 0 0 17 5 0 0 0 0 1 0 0 0 0 0 0 425 Spn. 0 0 0 6 0 0 4 0 56 4 0 0 0 0 0 0 0 0 0 0 0 7 1 5 0 84 Fra. 867 1408 0 248 14 24 352 799 106 32 6 0 0 31 4 0 23 0 0 0 0 10 8 0 0 3932 Gre. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Irl. 0 0 0 0 5 0 0 0 0 19 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 24 Ita. 1 0 0 0 2 0 0 1 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 6 Neth. 22 17 0 2 5 0 5 2 0 4 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 56 Por. 0 0 0 44 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 45 U.K. 160 20 15 109 13 1 106 5 47 134 0 0 3 0 0 0 0 0 0 0 0 0 0 0 0 613 Aust. 11 0 0 0 0 0 0 39 0 0 0 0 0 0 2 7 0 0 0 0 6 0 3 0 0 69 Fin. 51 5 2 0 0 0 -0 8 22 3 31 0 28 21 0 0 0 20 0 0 0 0 0 0 0 190 Swed. 137 12 37 22 1 0 4 0 26 7 2 0 0 12 0 0 0 0 0 0 0 0 0 0 0 260 Pol. 102 0 0 6 0 0 0 2 10 0 0 0 3 0 0 1 0 0 0 0 0 0 0 0 0 125 Hun. 1 0 0 0 1 8 0 86 2 0 0 91 0 0 2 0 38 0 0 0 28 0 0 58 1 317 Cz.R. 138 0 0 0 1 0 0 4 0 0 0 39 0 0 34 0 57 0 0 0 0 0 0 4 0 276 Slk. 2 0 0 0 0 0 0 13 5 0 0 5 0 0 4 5 11 0 0 0 0 0 0 2 3 51 Est. 7 0 7 0 0 0 8 11 8 0 0 0 2 0 0 0 0 0 20 0 0 15 0 0 0 77 Lat. 16 0 45 8 0 0 6 0 0 9 0 0 0 0 0 0 0 0 1 12 0 0 0 0 0 96 Lit. 7 0 4 12 5 0 10 0 13 15 0 0 2 0 5 0 0 0 2 41 0 0 0 0 0 115 Sln. 0 0 0 0 0 0 0 5 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 5 Cyp. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Mal. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Rom. 1 0 0 30 5 52 0 60 6 14 0 4 0 0 0 2 0 0 0 0 0 0 87 13 0 273 Bul. 0 0 0 94 2 75 0 25 0 0 0 3 0 0 0 0 0 0 0 0 0 0 16 0 21 236 EU 1839 1498 210 671 94 150 180 750 1706 388 120 192 7 53 186 13 22 118 23 62 13 35 140 29 90 5 8594 origins destinations 2010/11 Ger. B/L Den. Spn. Fra. Gre. Irl. Ita.Neth. Por. U.K. Aust. Fin. Swe. Pol. Hun. Cze. Slk. Est. Lat. Lit. Sln. Cyp. Mal.Rom. Bul. EU Ger. 52 65 114 48 0 26 194 764 65 3 11 0 6 65 0 3 0 0 0 0 0 3 4 2 0 1425 B/L 16 0 0 8 0 0 0 150 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 175 Den. 279 7 13 5 0 26 0 79 9 20 0 0 12 9 0 0 0 0 2 0 0 0 0 0 0 461 Spn. 0 1 0 12 0 0 9 0 51 5 0 0 0 0 0 0 0 0 0 0 0 13 3 9 0 102 Fra. 834 1393 0 412 26 34 368 981 143 15 2 0 0 0 7 0 5 0 0 0 0 52 6 0 0 4280 Gre. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 Irl. 0 0 0 0 2 0 0 0 0 19 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 21 Ita. 2 0 0 0 2 0 0 1 0 0 1 0 0 0 0 0 0 0 0 0 0 1 0 0 0 7 Neth. 9 19 0 0 2 0 3 2 0 4 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 39 Por. 0 0 0 12 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 12 U.K. 221 54 24 93 28 3 112 9 163 32 0 0 5 0 0 0 0 0 0 0 0 0 0 0 0 743 Aust. 16 0 0 0 0 0 0 48 0 0 0 0 0 0 2 6 0 0 0 0 12 0 6 0 0 91 Fin. 26 3 2 20 0 0 16 15 44 6 8 0 8 2 0 0 0 0 0 0 0 0 0 0 0 149 Swed. 117 11 68 7 1 0 8 0 26 8 3 0 0 18 0 0 0 0 0 0 0 0 0 0 0 268 Pol. 90 0 0 20 0 0 0 4 20 0 0 1 2 0 0 2 0 0 0 0 0 0 0 0 0 138 Hun. 2 0 0 0 0 76 0 96 25 0 0 76 0 0 3 0 14 0 0 0 21 0 0 230 1 543 Cz.R. 164 0 0 0 2 0 0 23 1 0 0 31 0 0 48 0 22 0 0 0 0 0 0 117 0 408 Slk. 1 0 0 1 0 0 0 23 10 0 0 18 0 0 12 17 15 0 0 0 1 0 0 2 46 145 Est. 11 0 3 0 0 0 10 21 16 0 0 0 4 0 0 0 0 0 39 0 0 30 0 0 0 134 Lat. 12 0 41 4 0 0 3 0 0 11 0 0 0 0 0 0 0 0 1 17 0 0 0 0 0 89 Lit. 13 0 7 3 9 0 13 0 17 20 0 0 4 0 6 0 0 0 2 94 0 0 0 0 0 187 Sln. 0 0 0 0 0 0 0 7 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 7 Cyp. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Mal. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Rom. 1 0 0 37 8 71 0 49 24 27 0 8 0 0 0 3 0 0 0 0 0 0 84 4 0 315 Bul. 0 0 0 76 3 94 0 27 0 0 0 7 0 0 0 0 0 0 0 0 0 0 42 0 34 283 EU 1813 1539 210 812 130 269 252 893 2320 372 79 154 9 30 164 29 26 40 4 135 17 34 225 23 394 47 10022 Table4.5:intra-EU27barleytrade2011/12(kt) Table4.6:intra-EU27barleytrade2010/11(kt)
  • 40. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union barley balances 40 50 100 150 200 250 300 350 400 $/t barley Fob Europe US 2 Yellow corn Fob Gulf changeinmainexports 09/10 10/11 11/12 ∆ Australia 3.5 3.7 3.7 -0.1 Ukraine 6.2 2.6 4.8 2.2 EU27 1.1 5.0 3.0 -2.0 Canada 1.1 1.4 0.9 -0.4 RussianFed. 2.8 0.3 0.5 0.2 USA 0.1 0.1 0.1 0.0 Argentina 0.6 1.2 1.2 0.0 Kazakhstan 0.4 0.2 0.3 0.1 Turkey 0.8 0.0 0.1 0.1 Total 16.7 14.6 14.6 0.1 changeinimportrequirements 09/10 10/11 11/12 ∆ S.Arabia 7.5 6.2 6.3 0.1 Russia 0.0 0.5 0.1 -0.4 China 2.1 1.7 1.6 -0.1 Japan 1.5 1.4 1.4 0.0 Jordan 0.5 0.5 0.6 0.1 Israel 0.4 0.3 0.3 0.0 Syria 0.2 0.2 0.5 0.3 Iran 0.9 0.3 0.6 0.3 SouthAmerica 0.8 1.0 0.9 -0.1 Algeria 0.0 0.1 0.1 0.0 Morocco 0.3 0.2 0.2 0.0 Tunisia 0.1 0.6 0.5 -0.1 Libya 0.5 0.4 0.4 0.0 Others 2.0 1.4 1.4 0.0 Total 16.7 14.6 14.6 0.1 Mt 08/09 09/10 10/11 11/12 carry-instocks 21.4 34.6 40.1 28.9 production 155.8 149.2 122.2 133.2 imports 19.5 16.7 14.5 14.6 exports 19.5 16.7 14.5 14.6 consumption 142.5 143.7 133.4 138.3 carry-outst. 34.6 40.1 28.9 23.8 Ukraine Russia Australia Canada Mt 10/11 11/12 10/11 11/12 10/11 11/12 10/11 11/12 carry-instocks 1.0 1.8 1.6 0.4 2.3 2.8 2.6 1.0 production 8.8 9.3 8.3 15.3 8.6 8.0 7.6 8.5 imports 0.0 0.0 0.5 0.1 0.0 0.0 0.0 0.0 exports 2.6 4.8 0.3 0.5 3.7 3.7 1.4 0.9 consumption 5.4 5.5 9.7 14.5 4.4 4.5 7.8 7.7 carry-outst. 1.8 0.8 0.4 0.8 2.8 2.7 1.0 0.9 Table4.7:estimatedsupplyanddemandbalance sheetsforthemainexportingcountries source:Stratégiegrainsbasedonvarioussources Graphic4.1:worldbarleyandmaizeprices (FOBmainoriginsinUS$/t) haverisensharplysincelastmonth:onFrench new crop barley, they are now 38 €/t for win- ter barley (last month: 13 €/t) and 67 €/t for springbarley(lastmonth:33€/t). In Australia, the cheapest malting barley is priced at 290-295 $/t FOB Adelaide (com- paredwith300$/tlastmonth). World barley market in 2010/11 Little change this month to our forecasts for world barley production and demand (esti- matedat122.2Mtand133.4Mtrespectively, seetable4.8). Wehavereducedourforecastforworldbarley trade by 0.2 Mt since last month to 14.5 Mt (16.7 Mt in 2009/10). This reflects lower im- portforecastsforSaudiArabia(-0.2Mtto6.2 Mt), and Russia (-0.1 Mt to 0.5 Mt); this reduction is partly offset by a higher importforecastforTunisia (+0.1 Mt to reflect record- ed shipments so far) and Algeria (+70 kt to reflect this country’s recent bar- ley purchase on the world market). The reduction in import needs mostly impacts on exportsfromUkraine(-0.2 Mtto2.6Mt)andtoasmallerextent Australia(-0.1Mtto3.7Mt);exports from the USA and Kazakhstan are bothreviseddownby30kt.Bycon- trast,toreflectrecordedshipmentsso far,wehaveincreasedourexportfore- casts for Argentina (+0.1 Mt to 1.2 Mt, mainly to Brazil, Iran, Tunisia, Uruguay)andCanada(+80ktto1.4 Mt,mainlytoIranandJapan). As far as EU exports are concerned, ourforecastremainsat5Mt.Since last month, we have increased pro- jectedexportsfromFrance(+0.1Mt to 1.4 Mt), notably to Algeria (+70 kt), Syria (+60 kt), China (+30 kt) and Switzerland (+20 kt) but re- duced projected exports to Saudi Arabia(-70kt).DanishexportstoKazakhstan arereviseddownby30ktto630kt.May3,ex- portlicencefixationsforbarleyattheEuropean Commissiontotalled4.2Mt(upfrom3.85Mt on April 8). To match our current forecast of 4.95Mt,licencesfor0.8Mtwillneedtobeob- tainedbeforetheendofJune(or90ktto100 ktperweek,whichisclosetotheaverageofthe fourpastweeks). World barley market in 2011/12 New reduction for world barley har- vest Afterareductionof27Mtin2010/11,global barley production is forecast to increase by 11 Mt in 2011 to 133 Mt. However, since last month we have reduced our production fore- castby1.7Mt. This decrease takes account of reductions for thefollowingcountries/regions:  EU27:-0.3Mt,seeearliersection;  BlackSea:-2.1Mt;thelatearrivalofspring in the Black Sea countries delayed bar- ley plantings across the region and many farmers have transferred planting inten- tions to maize. We have therefore reduced our spring barley planting forecasts for RussiaandUkraine;barleyproductionin Ukraine is revised down by 0.9 Mt to 9.3 Mt(8.8Mtin2010/11)andproductionin Russiafallsby1.2Mtto15.3Mt(8.3Mtin 2010/11);  Iraq: harvestable area is revised down to reflect the lack of rain; production falls by 0.2 Mt this month to 0.7 Mt (1.2 Mt in 2010/11);  Turkey: barley area is now forecast slightly lower than in 2010/11 at 3.3 Mha (down from3.4Mhapreviouslyandin2010/11). Production is estimated down from 6.6 to 6.4Mt(5.9Mtin2010/11);  China: estimated barley yield has been re- duced from 4.06 to 3.84 t/hatoreflect the dry conditions, although this is still higher thanlastyear(3.7t/ha).Barleyproduction isnowestimatedat2.6Mt(comparedwith 2.7Mtpreviouslyand2.4Mtin2010/11). We have nevertheless increased our harvest forecasts for certain other regions, although Table4.9:changesinexport availabilitiesandimport requirementsforthemainbarley tradingcountries source:Stratégiegrains Table4.8:worldbarleybalance source:IGCandStratégiegrains
  • 41. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union barley balances 41 kt 2007/08 2008/09 2009/10 2010/11 2011/12 WesternEurope(nonEU) 150 60 98 129 95 EasternEurope(nonEU) 85 48 24 57 30 Turkey 82 99 65 70 65 CIS 103 28 0 361 50 NorthAmerica 1 1 16 0 0 SouthAmerica 0 29 113 133 0 Iran 0 58 0 0 50 SaudiArabia 2085 1468 229 2361 1590 China 103 304 343 452 250 Jordan 246 0 0 380 150 OtherAsia 166 652 52 207 110 Libya 14 66 0 150 140 Tunisia 417 176 44 358 280 Morocco 316 255 129 184 120 Algeria 19 314 0 80 50 OtherAfrica 6 40 16 29 0 others 6 0 2 2 0 total 3800 3599 1131 4953 2980 Table4.10:EU27barleyexportsontheworld markettomainthirdcountrydestinations source:Stratégiegrains nottoasufficientextenttocompensateforthe reductionsmentionedabove:  North Africa: +0.65 Mt; estimated yields have increased in Algeria, Morocco and Tunisia due to the rains in April which shouldguaranteeagoodyieldpotential;  Canada:StatCanhaspublishedtheresults ofitssurveyoffarmers’plantingintentions. It forecasts a 13% increase in barley area compared with last year. We believe that this estimate is optimistic given that the soil is still waterlogged and that this could delay or even prevent plantings. We have nevertheless increased our forecast for bar- ley plantings in Canada (harvestable area) from2.5to2.6Mha(2.4Mhain2010/11) to reflect the fact that late plantings would more likely favour barley than other crops. Production is revised up by 0.2 Mt this monthto8.5Mt(7.6Mtin2010/11). Tighter outlook for 2011/12 Wemaintainourforecastforagrowthinglob- al demand for barley in 2011/12 (+ 5 Mt to 138 Mt); this mainly concerns Russia (where consumption is set to return to normal after the crash of 2010/11 following the drought). Demand for barley in animal feeds is set to remain high in North Africa and the Middle East. Nevertheless, if maize availabilities in the BlackSearegionareashighandcurrentlyfore- cast, maize could capture some demand cur- rently allotted to barley in the Mediterranean countries. This potential competition will needtobecloselymonitoredassoonasthesize of the harvests and Black Sea maize prices are knownwithgreaterprecision. GlobalbarleystockonJuly12011isestimated 11 Mt less than on July 1 2010 (see table 4.8). Thisreductionwillbeoffsetbythelargerpro- jectedharvest(+11Mt).Inparallel,demandis forecasttoriseby5Mt,generatinganewreduc- tioninworldendingstockonJune302012of 5Mt(to24Mt).Thislevelofendingstockwill represent17%ofannualglobaldemand,down from 22 % at the end of 2010/11 (compared with 16% in 2007/08). The outlook for the world market in 2011/12 has therefore tight- enedsincelastmonth.Itcouldbecometighter still if the harvests do not match our current forecasts. World trade volume forecast stable compared with 2010/11 We have now established import forecasts for all the major barley importing countries in 2011/12onthebasisofavailabilities,expected qualityandcompetitivepricerelationshipsbe- tweenthevariousorigins. We estimate global barley trade in 2011/12 at 14.6Mt(closetothelevelof2010/11,seetable 4.9).SaudiArabia’simportneedisforecastal- moststableat6.3Mt(+80kt);itissettoremain muchlowerthanthehighlevelof2009/10(7.5 Mt)onaccountofthegovernment’saimofdi- versifyingtherangeofrawmaterialsusedinthe country’s animal feed sector. Elsewhere in the Middle East, we forecast higher import needs inIran,Syria(+0.3Mteach)andJordan(+50 kt),duetolowerdomesticavailabilitiesinthese countries. Meanwhile import requirements for barley in North Africa are forecast to be lowerthanin2010/11(-0.1Mt)duetolarger domestic harvests. Similarly, import needs in SouthAmericaareforecastslightlylowerthan in2010/11(-0.1Mtto0.9Mt).Lastly,Russia is set to import less in 2011/12 (-0.4 Mt), on accountoftheriseindomesticavailabilities. On the export side, we forecast that exports from Ukraine will increase to 4.8 Mt (com- pared with 2.6 Mt in 2010/11 and 6.2 Mt in 2009/10). Government decisions will have a significant impact on the actual level of ex- ports from Ukraine, in particular the decision onwhetherornottoimposeataxonexports. Exports from Russia are forecast to rise from 0.3Mtin2010/11to0.5Mt(comparedwith 2.8Mtin2009/10). Export availability in Canada is set to fall by 0.4 Mt to 0.9 Mt due to the sharp reduction inopeningstocks.Assumingtheirharvestsare in line with our current forecast, exports from Argentina and Australia will remain high at 1.2Mtand3.7Mtrespectively(thesameasin 2010/11),althoughthebarleyhasnotyetbeen plantedinthesecountries. Given these forecasts, we estimate demand addressedtotheEUfromtheworldmarket at3Mt,whichis2Mtlessthanin2010/11. This level is close to our current estimate for EUexportavailabilityin2011/12. The reduction in EU exports compared with 2010/11 will concern shipments to Saudi Arabia (-0.8 Mt), Russia (-0.3 Mt), Jordan, China and North Africa (-0.2 Mt each) and SouthAmerica(-0.1Mt).Intermsofnational exports,thiswillimpactonGermany(-0.7Mt compared with 2010/11 to 0.5 Mt), France (-0.3Mtto1.1Mt)andDenmark(-0.3Mtto 0.3Mt). N.B:Subscriberstothe“Exports”moduleat ourwebsitestrategie-grains.comcanconsultthe fulllistofimportandexporttransactionsonthe worldmarketandthebreakdownofourEU exportforecastsfor2010/11and2011/12into suppliercountriesandshipmentdestinations.
  • 42. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union barley balances 42 2010/11 Ger. B/L Den. Spn. Fra. Irl. U.K. Aust. Fin. Swe. Pol. Hun. Cze. Slk. Est. Lat. Lit. Rom. Bul. others EU unsoldstock1/7/10 1826 35 60 -0 887 0 0 155 41 797 201 366 410 302 171 75 23 153 61 50 0 5613 exportssales 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 openstockforexport 0 0 0 0 0 0 0 -0 0 0 0 0 0 0 0 0 0 0 0 0 0 -0 interiorsales 1101 0 60 0 70 0 0 151 21 754 184 0 64 158 80 40 5 91 0 8 0 2787 openstockforintérior 583 35 -0 0 817 0 0 0 20 38 0 365 334 146 76 35 18 61 61 34 0 2622 intake&offers 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 waste 0 0 0 0 0 0 0 0 0 5 0 0 0 0 0 0 0 0 0 0 0 5 unsoldstock 725 35 -0 -0 817 0 0 4 20 37 16 366 346 146 91 35 18 62 61 42 0 2822 nonopenstock 143 0 0 -0 -0 0 0 4 0 -0 16 1 12 -0 16 0 0 1 -0 8 0 200 FeedBarley May2011 delivered price exfarm/ works Germany €/t 192.0 185.0 Denmark DKK/q FrancebasisJuly €/t 175.0 175.0 UnitedKingdom £/t 170.0 Spain €/t 223.0 Italy €/t 241.0 theNetherlands €/t 195.0 Sweden SEK/q Finland €/t 167.0 Table4.11:EUbarleyinterventionstockasof06/05/2011 Analysis of ending stocks and conclusion 2010/11: surplus — 2011/12: supply and demand in balance except in the eastern countries Crop year 2010/11 Ending stockonJune30,2011remainsat8.2 Mt; it has not changed greatly because the in- creaseinanimalsectordemandisoffsetbythe reductionindemandforbarleyinbiofuelpro- duction. The balance sheet 2010/11 is show- ing a projected surplus of 2.5 Mt (over and above the level of stock required to comfort- ably supply the market until the next harvest arrives). The size of this surplus will be depen- dentonthereleaseof0.6Mtfromintervention stocksviathefoodaidprogrammforthepoor between now and the end of June. Given that 1.6 Mt has been sold in this programme since theendofMarch,thisvolumeshouldbeeasily reached. The projected surplus remains located in Germany (0.6 Mt), France (0.5 Mt), Finland (0.4 Mt), Romania (0.3 Mt), Poland and Bulgaria(+0.2Mteach). Despite the resale of intervention stocks onto the internal market, barley prices have not changed much since last month (especially in France);weattributethistothesustainedlevels ofexportdemandforEUbarley.Nevertheless, theexistenceofthesurplusshouldsoonstartto beardownonoldcropprices.Includingstorage costs,oldcropbarleyisnowslightlydearerthan new crop: +7 €/t FOB Rouen for October 2011,comparedwith+2€/tlastmonth.This spread has no reason to exist given the surplus projectedfortheendof2010/11. Crop year 2011/12 EU27openingstockonJuly1,2011isforecast muchlowerthanayearearlier(-7.4Mt).Most of this reduction relates to the fall in interven- tionstockcomparedwiththestartof2010/11 (-5Mt);openmarketstockisforecastdownby 2Mt. Withproductionsettoincreaseby1.3Mtand demand to decline by 1.4 Mt (increase in hu- man/industrial but reduction for animal sec- tor), EU barley supply is forecast to decrease by7Mtcomparedwith2010/11andinternal demandby5Mt.Exportavailabilitywillthere- forebelowerthanin2010/11. Ouranalysisofworldsupplyanddemandindi- catesthatinthecontextofworldtradevolumes remaining virtually unchanged compared with 2010/11, Ukraine’s exports will increase by over 2 Mt to 4.8 Mt. We do not envisage thatUkraine’sexportswillincreasetothelevel of 2009/10 (6.2 Mt) because production in Ukraineisonlyforecasttoincreasemoderately. WeestimatedemandaddressedtotheEUat3 Mt(downfrom5Mtin2010/11);thisisclose to our current forecast for EU export avail- ability (3.5 Mt) and will leave the EU with a barleysurplusof0.5Mtattheendof2011/12. Giventhetightworldoutlook,EUsupplyand demand in 2011/12 already looks set to bal- ance,exceptintheeastwhereweforecastsmall surplusesinPoland(0.1Mt)andRomania(0.2 Mt). The fact that EU barley supply and demand in 2011/12 is already looking set to balance is neutral in terms of new crop barley prices. In thiscontext,severalbullandbearfactorscould nevertheless come into play. New crop feed barley prices could be influenced downwards by:  Ukraine’sreturnasabarleyexporteronthe worldmarket(thenewcroppriceofwhich is already very competitive on the world market);  Black Sea maize: if the harvests meet our current forecasts for this region, Black Sea maizecouldcaptureanimalsectordemand frombarleyinNorthAfricaandtheMiddle East;  Further reduction in demand in Saudi Arabia: Saudi imports in 2010/11 were much lower than in previous years due to government intervention (domestic price doubled; only one body authorised to im- portbarley). By contrast, feed barley prices could be pulled upbyanyproblemsimpactingontheharvests (wheat,barleyofmaize).Thetight –oratleast finelybalanced–outlooksforwheatandmaize couldalsosustainfeedbarleyprices. Malting barley: malting barley production is forecast at 11 Mt, up by 1 Mt compared with 2010/11. However, if the dry conditions per- sist, barley yields could face further reductions andqualitycouldalsobeaffected(riskofhigh protein content). Our malting barley harvest forecast has a decrease potential if the weather remainsdry. Given our estimates for production, quality and potential demand, we estimate that the EUwillhaveanexportablemaltingbarleysur- plusof0.8Mt(including0.3Mtofwinterbar- ley).Thisis0.3Mtlessthanin2010/11.World demand for malting barley addressed to the EU is set to be lower than in 2011/12 due to theincreasedavailabilitiesinArgentina(which shouldbeabletofullysupplyitsneighboursin Table4.12:EUbarley pricesasof06/05/2011
  • 43. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union barley balances 43 2006/07 2007/08 2008/09 2009/10 2010/11* 2011/12 EU25 EU27 EU27 EU27 EU27 EU27 maltingbarleyproduction 10421 10773 13398 14454 9997 10968 spring 7944 8459 10316 10780 7194 8359 winter 2477 2314 3082 3673 2804 2609 (a)internalEUdemand 10573 10739 10678 9971 10014 10184 (b)surplus:differentialbetweenmaltingpro- ductionandEUinternelneeds -152 34 2720 4482 1984 784 spring -262 87 2006 3123 991 523 winter 110 -54 715 1360 992 261 (c)exportstonon-EUcountries 379 317 480 594 1114 spring 370 214 157 261 714 winter 9 103 323 333 400 delta(b-c) -530 -283 2240 3888 870 784 spring -632 -127 1849 2862 277 523 winter 101 -157 392 1027 592 261 springmaltingbarleypremium -€/tFranceCreil 50-91 70-93 14-59 <5 18-39 wintermaltingbarleypremium-€/tFranceCreil 30-56 35-59 7-35 0 1-16 ratio(b/a):surplus/internaldemand -1% 0% 25% 45% 20% 8% 2011/12). The outlook for malting barley in 2011/12 is therefore set to be tighter than in 2010/11, with potential surplus equating to 8 % of an- nualdemand(comparedwith20%attheend of2010/11). The malting barley premiums have increased sharply since last month: +25 €/t for winter barley and +34 €/t for spring barley. This re- flects concerns over the dry weather of recent weeks.Thepremiumsarenowhigh(38€/tfor winterbarleyand67€/tforspringbarley)and willhavelittlepotentialfordecreaseuntilrains return. Table4.13:comparisonofthemaltingbarleysituationin2011/12with situationsfrom2006/07to2010/11 *balancesheetfor2010/11includes2 Mtcarry-throughfrom2009/10
  • 44. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union barley balances 44 0 50 100 150 200 250 300 -10 0 10 20 30 40 50 60 Jan-97 Jun-97 Nov-97 Apr-98 Sep-98 Feb-99 Jul-99 Dec-99 May-00 Oct-00 Mar-01 Aug-01 Jan-02 Jun-02 Nov-02 Apr-03 Sep-03 Feb-04 Jul-04 Dec-04 May-05 Oct-05 Mar-06 Aug-06 Jan-07 Jun-07 Nov-07 Apr-08 Sep-08 Feb-09 Jul-09 Dec-09 May-10 Oct-10 Mar-11 FOBCreilwinterbarley6R-€/t premium-€/t premium = (FOB Creil WB6R - FOB Moselle feed) €/t FOB Creil winter barley 6R - €/t 0 50 100 150 200 250 300 350 -10 10 30 50 70 90 110 130 Jan-97 Jun-97 Nov-97 Apr-98 Sep-98 Feb-99 Jul-99 Dec-99 May-00 Oct-00 Mar-01 Aug-01 Jan-02 Jun-02 Nov-02 Apr-03 Sep-03 Feb-04 Jul-04 Dec-04 May-05 Oct-05 Mar-06 Aug-06 Jan-07 Jun-07 Nov-07 Apr-08 Sep-08 Feb-09 Jul-09 Dec-09 May-10 Oct-10 Mar-11 FOBCreilspringbarley-€/t premium-€/t premium = (FOB Creil SB - FOB Moselle feed) €/t FOB Creil spring barley - €/t Graphic4.2:wintermaltingbarleypricesinFranceandpremiumsoverfeedbarleyprices Graphic4.3:springmaltingbarleypricesinFranceandpremiumsoverfeedbarleyprices
  • 45. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union maize balances European Union maize balances Methodology : Maize supply and demand estimates are based on an October- Septembercropyear,insteadofaJuly-Junecropyearasforwheatandbarley.Theyear beginsinOctoberbecausemostoftheEUmaizecropisharvestedafterOctober1. HoweverthebalancesbasedonaJuly-Junecropyearareavailableonwww.strat- egie-grains.com(accesscodesuppliedtosubscribersforfree,uponrequest). In France and the southern EU countries, however, the maize harvest begins sometime in September. This is why maize supply and demand summary tables detailthecropharvestedbeforeandafterOctober1. As for wheat and barley, the summary tables mirror current prices and their implications in terms of internal demand and intra-EU trade. They show how supplyanddemandrelatetocurrentpricesandpredictpricefluctuationsinthenear futurewhichcouldresultfromtradeimbalance. Thesurplusordeficitisthedifferencebetweenfree-marketcarry-overstockandthe minimum required by each country at the end of the crop year. The appearance of theoretic surpluses or deficits at the beginning of the crop year is a fundamental indicatorinanalysis,sincethefunctionofthemarketoverthecourseofthecropyear istoreduceanysurplusandeliminateanydeficits. 45 Crop year 2010/11 Maize imports are revised down by 0.3 Mt this month to 6.75 Mt, reflecting the fact that imported maize re- mains uncompetitive through the last months of crop year 2010/11; Ukrainian maize is the only origin that is competitive in the EU over this period, and only for south EU import destinations. In addition, the risk of trace presence of a GM variety not yet authorised in the EU will restrict the volume of imports from Brazil until August. Demand for maize in the bioethanol sector is revised up a little this month (+0.15 Mt). Demand for maize in ani- mal feeds is revised down by 0.3 Mt. Projected EU maize stock on September 30 2011 therefore decreases slightly this month but the EU balance sheet still has a potential maize surplus of 1.6 Mt. The outlook for EU maize therefore remains intrinsically bearish. However, the situation on the world market is still extremely tight for 2010/11 and 2011/12 (feed de- mand currently allotted to maize on the world will need to be rationed and transfer to other grains). If world prices rise from their current levels, imported maize will become less attractive in the EU, which would allow the EU market to tighten without a corresponding need for EU prices to decrease significantly. Nevertheless barley intervention stocks will continue to be released onto the internal market generating possible downward pressure on EU maize prices. Crop year 2011/12 Despite a reduction to estimated French maize produc- tion this month, we still envisage that the EU’s maize harvest in 2011 will be significantly better than in 2010 (+4.2 Mt to 59.1 Mt). Imports from third countries are forecast to fall by 2 Mt to 4.8 Mt due to the less competi- tive position of imported third country maize compared with 2010/11 (based on current prices for November 2011 deliveries). Internal demand for maize in the EU is still forecast up by 2.7 Mt compared with 2010/11. Animal sector demand is forecast up by 2.4 Mt, mostly on ac- count of increased maize usage in on-farm feeds and of demand for human consumption and industrial usage (up by 0.3 Mt). EU maize stock is forecast to decrease by 1 Mt through 2011/12 to 5.1 Mt; this level is significantly greater (+0.6 Mt) than the minimum stock needed to comfortably supply the market until the next harvest arrives. Maize stocks on the world market are forecast to rise by 6 Mt in 2011/12 to 115 Mt. However, at this stage, this in- crease cannot be taken completely for granted because it will depend on a significant rise in production (+44 Mt to 850 Mt), and at present maize plantings in the USA are badly behind schedule; this could mean that esti- mated maize area will need to be reduced if conditions are not ideal for plantings during the next few weeks. Ending stock 2011/12 is currently estimated at 13% of an- nual global demand, which remains relatively low. Even though rationing of demand in animal feeds (over to feed wheat) has already begun, it has not happened to a sufficient extent to enable world supply and demand to balance. New crop maize prices therefore have no poten- tial for decrease until harvest outcomes are certain. On the contrary they still have an increase potential in order to generate further reductions in demand; this will be intensified if plantings in the USA do not match current forecasts. At present new maize prices in the EU are cheaper than new crop prices. However, the outlook in 2011/12 is now much less heavy than the situation in 2010/11: this price differential should therefore narrow, either via a de- crease in old crop prices or an increase in new crop pric- es. The latter could be emphasized by the tight situation on the world market. However, if farmers planting inten- tions in the USA have been fully attained by mid-June and the crops develop correctly in Ukraine and Russia, this would generate a less tight outlook for 2011/12, which could allow for a reduction in 2011-crop prices.
  • 46. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union maize balances 46 October-Sept. 2011/12 carry-instockproductionimportsfrom supply grainsexportshum/ind.consumptionanimalfeed intervention carry-out free carry-out (2011 crop) 2012 production harvest. before 1 Oct. Total carry-out as of 1 Oct. 2012 surplus/deficit minimum free carry-out required intervention 2010 crop free carry-in 2011 prod. harvest. before 1 October total carry-in as of 1 oct 2011 prod. harvested after 1 Oct 2011 total EU 27 non-EU to EU 27 to non-EU total biofuels internal consump. total compound feed on-farm feed others (seeds, waste and overseas usage) demand total carry-out (2011 crop) Ger.0471001474537463719904667996822103620882745621876268611367010-22-2210078075 Bel/L070070818818759871734292011272401139454685121166407070070070 Den.080800929109212029631040660606 Spn.037325062329173167238228608782154116384451193641542812134124833204514512507010705 Fra.-050600650132041380455697145074737953250496275459783630234850514565-0-57-575504930493 Gre.0-19628084924120464651170625174074177110297422418950-190-18928091089 Irl.04104100428264954047047396044704848048047 Ita.0-334900566791788172576851114411112141001410963275532079294114590-315-3159005850584 Neth.02290229263263340239842921116148872076923962088308354036025625602560255 Por.037100137569669550797205324125402541723120851552007046461001460147 U.K.0320320052429985635030003004702252451081604040040035 Aust.-0190402302263230337502869454748013834218463481497752862-0664046051 Fin.030300103000000000330300 Swed.00008882184080850170110100 Pol.-027602762024202435192659283344230413816521297992480-017917901790180 Hun.04970497873887381455938552799310944376582181161880805775770577180397 Cz.R.-0247024789189128011675130271413469251218151023-014414401441400 Slk.034003411317131715016725490520273247391471506016516601661700 Est.040400911400000110110330300 Lat.0303001522000000170170330300 Lit.0-00-043432277211011011470680330300 Sln.0-687022292992004434146065065271119152225030-69-6970100 Cyp.0-00-000195252200015401546602200000000 Mal.0-00-00040444003803860440000000 Rou.015950159584458445962511007188166210772148635921162970301305130501305801225 Bul.0205020516411641737192674311034127314518401752017417401740171 EU 15055122702821334203569014291471655248692014610100207980213642913095490403443442220256402557 EU25118492340418946661490011529047947093513701242124513107934341540165269586113481349229036394903134 EU2713649234059905674759087163254806838681632510141386933491052047979185381040128272828229051185704530 Table5.1:EU27maizebalancesbycountry(kt):October-September2011/12
  • 47. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union maize balances 47 October-Sept. 2010/11 carry-instockproductionimportsfrom supply grainsexportshum/ind.consumptionanimalfeed intervention carry-out free carry-out (2010 crop) 2011 production harvest. before 1 Oct. Total carry-out as of 1 Oct. 2011 surplus/deficit minimum free carry-out required intervention 2009 crop free carry-in 2010 prod. harvest. before 1 October total carry-in as of 1 oct 2010 prod. harvested after 1 Oct 2010 total EU 27 non-EU to EU 27 to non-EU total biofuels internal consump. total compound feed on-farm feed others (seeds, waste and overseas usage) demand total carry-out (2010 crop) Ger.07110017138943994145830458265811710332178154035154124941135779047471001478068 Bel/L0650657487487321481693314011777401071673398121162307070070066 Den.0707009113111422029231030770706 Spn.02002504502756300620942356765696117145411173534842541094124728303733732506230620 Fra.-030332162413248135693541331435947581233196485271057273335239250514310-05050600650170477 Gre.0-198280828441124469171156738173073162611734532417620-196-19628084082 Irl.039039003051314763046046385043504141041046 Ita.0-3329005687209810923527231085210211139401394938576701715294111860-334-3349005660571 Neth.0429042928228222669013877762129854275622372082155353649022922902290232 Por.0421001425306302591047197823125102511661122443651941037371001370142 U.K.0360360043638785854029902994632332301082603232032035 Aust.-038377519191956696122702313847413633816433501293752512-01901904023018046 Fin.010100103000000000330300 Swed.0101881222300808150230000000 Pol.-013201321726172639749230475240727113614451271992028-02762760276120160 Hun.3110601109697669763926085384298731035386649247316180410497497049770424 Cz.R.-0204020469369319291926201631337921316615672-024724702472500 Slk.0370037010501050175015953330528284243348471255034034103413400 Est.030300751500000110110440400 Lat.0-00-0001251700000140140330300 Lit.03034747179130701001011301300-0-00-000 Sln.0-7070-023530515848441114064064310139171225090-68-6870200 Cyp.000000111922040015101515302040-0-00-000 Mal.040400271243003703760430-0-00-000 Rou.01441014418748874869971109591329658105820685261571629364015951595015953301262 Bul.086086196019601050215185112131793096174019460205205020520185 EU 150702198826903143833426115256328519816362166990519997906336881309514310551551227028214302392 EU253245420584515421664422312826668166187114512411215429449210388401652643381184818492340418912102976 EU27339812058604252874549311363067527929813630102113529315910371456141853756481364936502340599015604423 Table5.2:EU27maizebalancesbycountry(kt):October-September2010/11
  • 48. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union maize balances 48 kt 08/09 09/10 10/11 11/12 USA 55 93 462 60 Canada 9 1 449 10 Turkey 10 6 11 4 Croatia 302 193 107 150 Serbia 950 706 1188 1350 Ukraine 417 635 1651 1780 Moldavia 25 24 96 90 Peru 5 6 4 1 Brazil 517 874 2044 950 Chile 46 14 1 1 Paraguay 0 0 180 150 Argentina 373 376 277 250 Others 52 10 282 10 Total 2761 2938 6752 4806 Crop year 2010/11 Production EU maize production in 2010/11 has in- creased slightly since last month (+75 kt in Belgium)to54.9Mt. Imports from third countries We have slightly reduced our estimate for maizeimportsfromthirdcountries(-0.3Mt compared with last month) to 6.75 Mt. This changereflectsfirstlythelevelofimportlicence fixations at the European Commission as of May32011andsecondlythefactthatimport- edmaizeisnowslightlylesscompetitiveforthe remainder of 2010/11 (October-September crop year) than it was during the first half of thecropyear.Ukrainianmaize(whichisnow available again on the world market, export quotas having been officially axed on May 5) is currently at price parity for export to CataloniaalthoughthispricingfavourFrench exports to this destination. In the Benelux, Ukrainian maize is at parity with the cheap- est EU origin for the summer months, which also favours EU maize exports to this destina- tion.However,Ukrainianmaizeiscompetitive delivered North Spain, Portugal and Italy, with an advantage of 10 to 20 €/t compared with EU origins. We therefore expect to see UkrainianmaizeimportsarrivingintheseEU destinationsinthenextfewweeks. South American non-GM maize (mostly fromBrazil)iscurrentlyunavailabletotheEU marketandisnotlikelytoreappearforimport totheEUuntilatleastAugust.Thisisbecause the risk of accidental presence of a GM maize variety(MIR162)notyetauthorisedforcom- mercial usage in the EU (authorisation is in process) is considered too high. The EFSA (EuropeanFoodSafetyAuthority)hasstillnot delivered its verdict on this new maize variety. Meanwhile, the draft bill allowing trace pres- ence up to 0.1% unauthorised GM varieties in import shipments is still being studied but has not yet been approved by the Council of MinistersortheCommissionitself.Therefore Brazilianmaizeisnotlikelytobecomeavailable totheEUmarketuntilthelastquarterofcrop year2010/11. Serbianmaizeisnolongercompetitiveinthe EU:itis10€/tmoreexpensivethanthecheap- estEUorigininthesouthand30-40€/tdearer inthenorthEU. Reflectingthesechanges,wehavereduced ourimportforecastsasfollows:Italy(-145 kt),Netherlands(-110kt),andSlovenia(-110 kt).MeanwhileprojectedSpanishimportsare estimatedup(+120kt). Sincelastmonthwehavedecreasedour forecastforEUimportsfromBrazilby230 kt,fromArgentinaby100kt,fromSerbiaby 120ktandfromCroatiaby60kt.Projected importsfromUkraineareunchangedat1.65 Mt.Toreflectrecordedshipmentssofar, maizeimportsfromtheUSAandCanadaare revisedupby40ktand50ktrespectively). Demand for maize for human con- sumption and industrial usage Demand for maize for human consumption andindustrialusageisrevisedupby150ktthis month to 13.5 Mt. This stems from a rise in estimated maize usage in bioethanol produc- tion in Spain (+110 kt) and Austria (+35 kt). We now estimate maize usage in bioethanol productionintheEU27at3.16Mt(+0.6Mt comparedwith2009/10). Demand for maize in animal feeds Demand for maize in animal feeds is revised down by 320 kt this month to 45.6 Mt. This month’s reduction concerns the Netherlands (-230 kt), Germany (-195 kt), Spain (-20 kt) and Belgium (-15 kt) although demand has increasedslightlyinFrance(+65kt).Maizeus- ageinon-farmfeedsisrevisedupby110ktin France to tie in with the lower forecast for ex- farmmaizecollectionin2010/11.Bycontrast it has decreased in the UK (-95 kt) reflecting thelowerforecastforUKmaizeavailabilities. Crop year 2011/12 Production Maize grain production in 2011/12 is revised down by 0.4 Mt this month to 59.1 Mt. This decrease mostly corresponds to a transfer of crop area from maize grain to silage produc- tion in France: France’s maize grain harvest is therefore revised down by 0.6 Mt to 13.8 Mt. The decrease is partly offset by small increases inprojectedmaizearea,attheexpenseofspring barley, in Portugal, Belgium, Central Europe and Romania. The EU maize harvest in 2011 is still forecast sharply up on the level of2010(+4.2Mt). Imports from third countries As last month, maize imports from third countries are still forecast sharply down on the level of 2010/11(-1.9 Mt). On the basis of current new crop prices (deliver- ies from November 2011), maize imported fromSouthAmericaandSoutheastEurope (Serbia)isstillatparitywiththeEUorigins inthemainimportzonesinthesouthEUbut ismoreexpensivethanEUmaizeforexport to the Benelux. Imported maize is therefore settoremainlesscompetitivethanin2010/11, when imported maize had a price advantage over EU maize of at least 10 €/t in the north EUOctoberthroughMarch. Nevertheless since last month we have in- creased our estimate for maize imports from third countries by 220 kt to 4.8 Mt. ThisreflectsanincreasefortheEUimportre- quirementonaccountofthelowermaizepro- duction forecast for 2011. In addition, export availability in Ukraine for 2011/12 has been revisedup(increasesforplantedareaandpro- duction).Wethereforenowestimatemaizeim- ports from Ukraine at 1.8 Mt (+0.5 Mt com- paredwithlastmonthand+0.1Mtcompared with2010/11).ProjectedimportsfromBrazil have increased slightly this month (+0.2 Mt to 950 kt) whilst projected imports from the USA, Canada and Argentina have decreased (following a reduction in 2010/11 in the case ofArgentina).TheUSAandCanadawillnot beabletoexportasmuchmaizeastheydidin 2010/11(seeWorldmaizemarketsectionbe- low).ProjectedimportsfromSerbiaremainat Table5.3:breakdownofEU27 imports(byorigin) Supply and internal demand 2010/11: small reduction for importations – production 2011/12 still set to increase sharply
  • 49. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union maize balances 49 maizepriceminus wheatprice (€/t) oldcrop newcrop 8-Apr 6-May 8-Apr 6-May deliveredNantesstandard 1.0 -12.0 -22.0 exSthCôted’or(mill.) -18.0 -16.0 5.0 FobCreilstandard exEureetLoir(milling) -4.5 -19.5 13.0 -14.0 exEureetLoir(feed) 1.5 -6.5 -5.0 FobRhinestandard -9.5 -17.0 13.0 2.0 exLyonstandard exSouthWest(milling) -14.0 -14.0 Intra-EU maize trade Trade volume set to rise by 2.7 Mt in 2011/12 1.3Mt. Demand for maize for human con- sumption and industrial usage Demand for maize for human consumption andindustrialusageisforecastupby0.3Mtin 2011/12to13.9Mt.Partofthisincreaserelates to maize usage in the starch sector, which is revisedupby140ktfromthelevelof2010/11 to7.8Mt(+1.8%)reflectingeconomicgrowth in the EU. Demand for maize in other food sectors (including semolina) is estimated at around 2.7 Mt, very slightly up on the level of 2010/11(+0.8%). Theremainderoftheoverallincreaserelatesto maizeusageinthebioethanolsector,which is now forecast up by 190 kt compared with 2010/11 to 3.3 Mt (virtually the same as last month). Nevertheless, since last month we have increased projected demand for maize in the bioethanol sectors in Spain (+50 kt), and Austria(+35kt)attheexpenseofothercereals; however, estimated maize usage has decreased inHungary(-70kt)duetothepostponement ofthelaunch of thePannoniaEthanol refinerytothesecondhalfof2012. Demand for maize in animal feeds Demandformaizeinanimalfeedsis now estimated at 48 Mt in 2011/12 (October-September);ithasdecreased byalmost0.8Mtsincelastmonth.This corresponds to large reductions in esti- mated on-farm maize consumption in France (-0.64 Mt) and Britain (-0.15 Mt)reflectinglowermaizeavailabilities inbothcountries. Maizeusageinanimalfeedsisnowfore- cast2.4Mtuponthelevelof2010/11, although this growth is now smaller than we forecast last month. Maize usage in on-farmanimalfeedsisstillsettobehigher thanin2010/11duetothelargemaizehar- vestsintheEU. Also, based on current prices for new crop grains, maize usage in industrial feedsshouldbesimilartothelevelof2010/11. Nevertheless, our estimate for maize usage in animal feeds has a high variation potential depending on relative changes in grain prices; demand could be estimated down if maize’s competitiveness compared with wheat and barleydeclines. Table5.6:spreadbetweenmaizeandwheat pricesinFrance source:StratégiegrainsusingdatafromLaDépêche Crop year 2010/11 Wehaveintegratedthelatestcustomsstatistics into our forecasting (March 2011 for France, February for Spain, Portugal, UK and Malta, January for the other countries). Following this, estimated intra-EU maize trade in 2010/11 is unchanged at 13.6 Mt, with sev- eraladjustmentsoffsettingeachother. Projected exports have increased from France (+140 kt), Hungary (+245 kt), and Bulgaria (+110kt)butdecreasedfromRomania(-110 kt), Slovenia (-100 kt), Germany (-110 kt), CzechRepublic(-80kt)andSlovakia(-70kt). Projected imports have been increased to Hungary (+220 kt), Austria (+140 kt) and Italy (+135 kt) but decreased for Germany (-260kt),Netherlands(-155kt),andUK(-80 kt). Crop year 2011/12 As a result of the less competitive position of maize imported from third countries compared with 2010/11, the volume of in- tra-EUmaizetradeisforecastupby2.7Mt in 2011/12 at 16.3 Mt. However, since last monthwehavereducedthisforecastby0.4 Mttoreflectthefallinprojectedmaizeexports from France due to its smaller maize harvest forecast. Based on current prices for November 2011, French maize is the most competitive origin for export to Catalonia. By contrast in Italy, PortugalandnorthSpain,eastEUmaizeisthe most competitive. In the Benelux, French and Hungarianmaizeareatparity. FrenchexportstootherEUcountriesarenow estimatedstablein2011/12.Bulgarianexports are forecast to decline (-110 kt). Meanwhile we still envisage a higher level of exports from Hungary (+1 Mt), Romania (+0,55 Mt) and Germany(+0.4Mt). On the import side, we now envisage the fol- lowing changes compared with 2010/11: Netherlands (+1.1 Mt); Spain (+0.3 Mt); Italy(+0.2Mt);Portugal(+0.3Mt);Germany (+0.5 Mt); Romania (+0.26 Mt); Greece (+0.18 Mt); France (+0.25 Mt); Austria (-0.3 Mt); Hungary (-0.25 Mt) and Slovakia (-0.16 Mt). NB:Subscriberstoouronline“Intra-EUtrade” webmodulecanconsultfulldetailsofouresti- matesforintra-EUmaizetradeincludingtrade flowsbyoriginanddestinationandrecorded tradevolumesatwww.strategie-grains.com.
  • 50. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union maize balances 50 origins destinations 2010/11 Ger. B/L Den. Spn. Fra. Gre. Irl. Ita.Neth. Por. U.K. Aust. Fin. Swe. Pol. Hun. Cze. Slk. Est. Lat. Lit. Sln. Cyp. Mal.Rom. Bul. EU Ger. 1 18 5 245 8 5 21 222 0 1 37 0 1 3 1 1 0 0 0 0 8 0 0 3 0 581 B/L 24 0 0 34 0 0 0 223 0 32 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 314 Den. 3 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 4 Spn. 2 6 0 7 0 0 2 0 49 28 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 96 Fra. 515 634 45 1545 6 227 299 946 129 365 2 1 5 19 6 2 1 0 0 0 0 0 8 2 1 4758 Gre. 0 0 0 0 0 0 10 0 0 0 0 0 0 0 0 0 0 0 0 0 0 4 0 0 24 38 Irl. 0 0 0 0 0 0 0 0 0 3 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 3 Ita. 18 2 19 8 16 7 0 13 0 1 7 0 4 0 1 0 0 0 0 0 0 3 0 4 0 102 Neth. 18 15 7 0 12 0 4 0 0 3 15 0 1 0 0 0 0 0 0 0 0 0 0 0 0 76 Por. 0 0 0 23 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 23 U.K. 6 0 0 0 18 0 28 0 0 0 0 0 0 2 0 0 0 0 0 0 0 0 0 0 0 54 Aust. 44 1 0 0 1 0 0 232 3 0 0 0 0 3 8 1 6 0 0 0 12 0 0 1 0 313 Fin. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Swed. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Pol. 68 0 2 0 0 0 0 0 1 0 0 0 0 0 1 1 1 0 1 0 0 0 0 0 0 75 Hun. 478 0 0 12 7 120 0 1487 675 0 0 462 0 0 172 6 145 5 8 0 138 12 1 498 72 4298 Cz.R. 122 0 0 0 0 5 0 0 0 0 0 46 0 0 74 0 13 0 0 0 0 0 0 0 0 262 Slk. 29 0 0 6 1 10 0 1 5 0 0 90 0 0 120 63 7 0 0 0 0 0 0 1 0 333 Est. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Lat. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Lit. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 2 3 0 0 0 0 0 7 Sln. 0 0 0 0 0 0 0 97 0 0 0 6 0 0 0 10 0 0 0 0 0 0 0 0 0 114 Cyp. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Mal. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Rom. 118 72 0 258 8 141 42 187 65 29 1 30 0 0 3 302 1 9 0 0 0 0 38 16 8 1329 Bul. 12 0 0 237 3 172 0 16 112 52 0 0 0 0 0 0 0 0 0 0 0 0 54 2 191 851 EU 1458 732 91 2094 354 469 305 2352 2266 259 436 696 1 12 397 392 19 175 7 12 1 158 111 27 699 105 13630 origins destinations 2011/12 Ger. B/L Den. Spn. Fra. Gre. Irl. Ita.Neth. Por. U.K. Aust. Fin. Swe. Pol. Hun. Cze. Slk. Est. Lat. Lit. Sln. Cyp. Mal.Rom. Bul. EU Ger. 1 22 16 441 4 6 18 411 0 3 36 0 0 2 0 1 0 0 0 0 4 0 0 2 0 968 B/L 15 0 0 24 0 0 0 234 0 18 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 292 Den. 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2 Spn. 1 5 0 7 0 0 2 0 101 36 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 154 Fra. 482 570 37 1358 6 302 180 1134 182 444 2 1 3 12 6 2 1 0 0 0 0 0 12 2 0 4737 Gre. 0 0 0 0 0 0 5 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2 0 0 17 25 Irl. 0 0 0 0 0 0 0 0 0 4 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 4 Ita. 18 2 13 11 16 14 0 14 0 2 4 0 1 0 1 0 0 0 0 0 0 5 0 9 0 111 Neth. 41 23 12 0 17 0 6 0 0 2 8 0 2 0 0 0 0 0 0 0 0 0 0 0 0 111 Por. 0 0 0 24 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 24 U.K. 3 0 0 0 9 0 20 0 0 0 0 0 0 3 0 0 0 0 0 0 0 0 0 0 0 35 Aust. 34 1 0 0 3 0 0 381 2 0 0 0 0 3 9 1 7 0 0 0 12 0 0 1 0 454 Fin. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Swed. 0 0 4 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 4 Pol. 273 0 4 0 0 0 0 0 1 0 0 1 0 1 0 1 1 0 1 1 0 0 0 0 0 283 Hun. 452 33 0 52 10 295 0 1674 1409 0 0 147 0 0 116 5 0 5 7 0 183 18 1 828 43 5279 Cz.R. 375 0 0 0 1 3 0 0 0 0 0 59 0 0 75 0 0 0 0 0 0 0 0 0 0 513 Slk. 113 0 0 61 1 16 0 2 46 0 0 89 0 0 127 77 17 0 0 0 0 0 0 1 0 549 Est. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Lat. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Lit. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 3 7 0 0 0 0 0 11 Sln. 0 0 0 0 0 0 0 136 0 0 0 4 0 0 0 5 0 0 0 0 0 0 0 0 0 146 Cyp. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Mal. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Rom. 153 124 0 567 7 166 95 170 152 203 15 25 0 0 12 46 1 6 0 0 0 0 101 25 12 1881 Bul. 27 0 0 293 20 143 0 8 0 63 0 0 0 0 0 0 0 0 0 0 0 0 69 2 119 743 EU 1990 759 92 2382 556 646 428 2576 3402 550 524 375 1 8 351 145 28 15 9 15 2 200 195 40 962 73 16325 Table5.5:intra-EU27maizetradeOctober-September2010/11(kt) Table5.4:intra-EU27maizetradeOctober-September2011/12(kt)
  • 51. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union maize balances 51 70 120 170 220 270 320 370 420 Us $/t US 2 Yellow corn Fob Gulf SRW Fob Gulf USA World USDA Stratégie grains USDA Stratégie grains Mt 10/11 11/12 10/11 11/12 10/11 11/12 10/11 11/12 carry-instocks 43,4 18,5 43,4 20,5 145,4 122,2 132,4 109,0 production 316,2 343,0 316,2 340,1 815,3 867,7 805,9 850,2 imports 0,6 0,5 0,5 0,4 91,1 90,9 92,1 85,2 exports 48,3 45,7 48,5 42,0 91,1 90,9 92,1 85,2 feedcons. 130,8 129,6 130,8 130,0 493,5 506,1 481,7 489,9 hum&indcons. 162,6 164,0 160,2 162,8 345,1 354,7 347,7 354,7 carry-outst. 18,5 22,9 20,5 26,2 122,2 129,1 109,0 114,6 US maize prices fall sharply Since April 8, the US FOB maize price has decreasedby28$/tto305$/t(May5).Maize pricesstayedbuoyantuntiltheendofAprildue tothedisruptionsfacedbyfarmersintheUSA duetoincessantrainsatplantingtime.Thenat thebeginningofMay,themaizepriceslumped, in response to the fall in the oil price and also thesharpdeclineinUSweeklymaizesalesfor export. Maize is still 5 $/t dearer than SRW (May 5) forspotdeliveries.Thespreadstaysatthislevel forJuneandJulycontrastbutfromAugust,US maize FOB falls back below the SRW price (-9 $/t). Meanwhile, ex-Black Sea, feed wheat is now trading at 270 $/t, which is 30 $/t cheaper than US maize FOB. Therefore projected demand for maizeinworldanimalfeedshasde- creased with demand share transfer- ringtofeedwheatfortheendofcrop year2010/11. South American maize prices have alsodecreasedsincelastmonth.The price of Brazilian maize FOB is 297 $/tspot,whilstArgentineanmaizeisat 301$/t(May5). In the EU, French maize is trading at 333 $/t FOB (+2 $/t compared with lastmonth)andsoutheastEUmaizeat 363 $/t (+24 $/t compared with last month); Ukrainian maize is priced at 314$/tforspot/near-term(+8$/t). ForMay-September2011,takingaccountof shipping costs, the most competitive origin forexporttotheMiddleEastandNorthAfrica is still Ukrainian maize, followed by South AmericanmaizethenEUandlastlyUSmaize. Fornewcropcontracts, the price structure is not the same. East EU maize is trading at 298 $/tFOB,comparedwithFrenchmaizeat295 $/t, US maize at 284 $/t and Brazilian maize at 299 $/t FOB. US maize is therefore the mostcompetitiveoriginforexporttoNorth Africa/Middle East, at parity with east EU maize, followed by French maize and eventu- ally by South American maize. However, new crop prices for Ukrainian maize are not yet availableonthemarket. The competitiveness of EU maize on the worldmarkethasthereforenotchangedgreatly sincelastmonthandwestillestimateEUmaize exports to third countries at 1 Mt in 2010/11 andin2011/12. World maize market in 2010/11 EstimatedworldmaizestocksonSeptember 30 2011 have been increased again this month to 108.7 Mt (+3 Mt). This reflects the fact that since lastmonth, maize has remained less com- petitive that feed wheat intheanimal feed sec- tor; demand for maize in global ani- mal feeds has therefore declined by 3.5 Mt since last month to 482 Mt. Global demand for human con- sumption and industrial usage is also revised down (-0.7 Mt) to 347.7 Mt due to the re- duction in estimated maize usage in ethanol production in the USA. In addition, opening stockisrevised upby0.5Mttoreflectalower forecastforanimalsectordemandin2009/10 andglobalmaizeproduction2010isrevisedup by1.5Mtto805.9Mt(higherharvestforecast forIndonesia). Worldmaizestocksarethereforenowforecast todeclineby24Mtthrough2010/11to108.7 Mt.Thislevelofstockequatestojustover13% of annual world demand. Thus although de- mand rationing on the world market has be- gun, the process will need to continue until world supply and demand bal- ance. The current spread between the world wheat and maize prices (-5 $/t in favour of wheat) should persist through the coming months in order for projected demand for maizetodeclinebyaroundanother 10 Mt. The world maize price there- fore has no decrease potential relative tothewheatprice. We have reduced our forecast for US maize exports by 0.3 Mt to 48.5 Mt to reflect the decline in maize’s com- petitiveness against feed wheat on the world market. In addition, estimated demand for maize in bioethanol pro- duction has decreased by 1 Mt due to thefallinethanolproductionmargins.Hence US maize stock at the end of 2010/11 is now estimated at 20.5Mt,upby 1.3Mtcompared withlastmonth’sforecast.Thisequatestoonly 7% of annual US demand. Therefore the US maizepricehasnointrinsicpotentialforde- crease compared with the other feed grain prices;onthecontraryitwillneedtorisein order to generate further reductions in ex- portdemandforUSmaize. In Ukraine, the government announced the end of export quota arrangements beginning May 5 2011. We have therefore increased our forecastforUkrainianmaizeexportsby0.4Mt to 5.9 Mt. This increase is relatively small be- causethecountryhadalreadyexportedaround 5.3 Mt of maize in 2010/11 (quota volumes permitted for export between November 15 andJune30combinedwithquantitiesshipped Graphic5.1:Americanmaizeprices(FOBGulf) Table5.7:USandworldmaizebalancesheets(Mt) World maize market Projected demand for maize in 2010/11 has started to decline; the outlook for 2011/12 remains tight due to uncertainty over planting levels in the USA
  • 52. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union maize balances 52 changein exports changeinimportrequirements 09/10 10/11 ∆ 09/10 10/11 ∆ USA 50,0 48,5 -1,5 EU27 2,9 6,8 3,8 Argentina 17,0 11,5 -5,4 Russia 0,0 0,4 0,4 Brazil 8,6 12,9 4,3 Japan 16,9 16,0 -0,9 SouthAfrica 1,1 2,2 1,1 SouthKorea 7,7 6,6 -1,2 China 0,1 0,0 -0,1 Taiwan 4,5 4,4 -0,1 India 1,9 3,0 1,1 Malaysia 3,0 3,0 -0,0 Ukraine 5,1 5,9 0,8 China 1,8 2,1 0,3 Russia 0,4 0,0 -0,4 OthersAsia 3,6 3,3 -0,3 Paraguay 1,3 1,5 0,2 Mexico 8,3 8,5 0,3 EU27 1,5 1,0 -0,5 Colombia 3,7 3,7 0,0 Others 5,2 5,5 0,3 Peru 1,8 1,6 -0,2 Total 92,3 92,1 -0,2 OthersSouthAmerica 3,8 3,5 -0,3 Egypt 5,8 5,5 -0,3 Algeria 2,6 2,2 -0,4 Morocco 1,8 1,7 -0,2 OthersNorthernAfrica 1,5 1,2 -0,3 Iran 4,1 3,7 -0,4 Syria 2,0 2,1 0,1 OthersNeareastAsia 3,7 3,7 0,0 Others 12,7 12,1 -0,6 Total 92,3 92,1 -0,2 Brazil Argentina Mt 09/10 10/11 11/12 09/10 10/11 11/12 carry-instocks 12.2 13.2 8.0 1.5 0.7 3.3 production 56.0 55.7 54.8 22.5 20.9 26.0 imports 0.6 0.4 0.8 0.1 0.4 0.1 exports 8.6 12.9 6.4 17.0 11.5 19.0 consumption 47.0 48.3 49.1 6.4 7.1 7.7 carry-outst. 13.2 8.0 8.0 0.7 3.3 2.8 Ukraine Russia Mt 09/10 10/11 11/12 09/10 10/11 11/12 carry-instocks 1.1 0.7 0.6 0.3 0.1 0.2 production 10.2 12.0 14.4 4.0 3.1 6.1 imports 0.0 0.0 0.0 0.0 0.4 0.0 exports 5.1 5.9 8.3 0.4 0.0 1.9 consumption 5.6 6.3 5.8 3.7 3.4 3.9 carry-outst. 0.7 0.6 0.9 0.1 0.2 0.5 SouthAfr. China Mt 09/10 10/11 11/12 09/10 10/11 11/12 carry-instocks 7.8 9.0 6.3 52.7 47.3 47.4 production 13.4 11.1 11.9 152.0 162.0 164.5 imports 0.1 0.1 0.1 1.8 2.1 3.0 exports 1.1 2.2 0.8 0.1 0.0 0.0 consumption 11.2 11.7 12.2 159.0 164.0 168.0 carry-outst. 9.0 6.3 5.3 47.3 47.4 46.8 priortotheintroductionofquotas). WehavereducedprojectedimportsinChina in 2010/11 to reflect recorded shipments so far from the USA and the recent decline in maize’s competitiveness in animal feeds: Chinese maize imports are now estimated at 2.1 Mt (including 1.8 Mt from the USA and0.1MtfromBrazil,ArgentinaandSouth Africa). World market in 2011/12 Maizestockontheworldmarketatthestartof 2011/12 is now forecast 24 Mt lower than at the start of 2010/11. Our forecast for world maize productionin2011/12isalmostthe same as last month at 850.2 Mt (+44 Mt compared with 2010/11). We have reduced our estimate for maize production in the USAby2.6Mtthismonthto340.1Mt,re- flecting a fall in estimated maize plantings. Maize plantings have been delayed due to in- cessant rains (in some cases torrential) in sev- eraloftheMidweststates.Eveniftheweather wereidealfromnowon,itwouldbeveryhard formaizeareatomatchtheleveloffarmers’ini- tial planting intentions (92.2 million acres ac- cordingtotheUSDA).Consequentlywehave reducedourestimateformaizeplantingsto92 million acres (37.2 Mha). In reality the loss of maize area could be greater still if unfavour- able weather persists, notably in Indiana and Ohio.Maizeareacouldbeestimateddownby afurther1to2millionacres(0.4to0.8Mha): thedecreasepotentialintermsofUSmaize productionwouldthereforerangebetween 4and8Mt. Such a large planting backlog in- evitably means that a significant area will not be planted until June, necessitating usage of quick-growingvarietieswithloweryieldpoten- tial than varieties planted in May. This could further accentuate the reduction in potential US maize production. The final extent of maizeplantingsintheUSAwillthereforebe akeyfactorintermsofthebalancebetween world supply and demand in 2011/12 and thesituationwillneedtobefollowedcloselyin the next few weeks. As a result of the smaller US harvest forecast, we estimate down US maizeexportsin2011/12to42Mt.Thedif- ferenceisreallocatedtoBlackSeaexports. Indeed,inUkraineandRussia,maizeplant- ings for the 2011 harvest are revised up sharply this month. Very wet conditions prevented farmers from completely fulfill- ing their spring barley planting intentions and this area is therefore liberated for maize culti- vation. Consequently maize production in Ukraine is revised up by 1.4 Mt to 14.4 Mt and maize production in Russia by 1.9 Mt to6.1Mt.Hencemaizeexportavailabilitiesin theBlackSeacountrieshaveincreasedsharply thismonthandwenowestimatethatUkraine couldexport7to8MtandRussia1to2Mt. FromOctober 2011,USmaizeismorecom- petitivethanSRWwheat(ex-USA).However, in the animal feed sector, maize will face stiff competition from feed wheat from the east EU,UkraineandAustralia. Maizeusageinanimalfeedsisnotsettoin- crease significantly in 2011/12 compared with 2010/11: it is estimated at around 490 Mt, up by 8 Mt only compared with 2010/11, mostly on account of increases in theEU(+2.4Mt),China(+2Mt)andBrazil (+0.8 Mt). By contrast, animal sector maize usage is set to remain stable or decrease in the main import zones (North Africa, Middle East, southeast Asia). Demand for maize for human consumption and industrial usage is forecast to increase by 7 Mt, reflecting growth in the bioethanol sector (+2.5 Mt) and de- mand for human food production (+4.5 Mt) inlinewithworldeconomicgrowthforecasts. Given the increase in world supply (+16 Mt), weforecastthatworldtradewilldeclineby7 Mtto85Mtin2011/12. Maize stocks are forecast to increase by al- most6Mtthrough2011/12to115Mt.This projected increase is nevertheless precari- ous,sinceitdependsonproductionmatching currentforecastsandthismaynotbeeasygiven Table5.8:maizebalancesheets forArgentinaandBrazil source:Stratégiegrainsbasedonacollationof varioussources Table5.9:maizebalancesheets forRussiaandUkraine(Mt) source:Stratégiegrainsbasedonacollationof varioussources Table5.10:maizebalancesheets forChinaandSouthAfrica(Mt) source:Stratégiegrainsbasedonacollationof varioussources source:Stratégiegrains Table5.11:changesinexportavailabilitiesandimportrequirementsfor maincountries
  • 53. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union maize balances 53 MaizeMay2011 delivered price exfarm/ works FrancebasisJuly €/t 222.0 218.5 Spain €/t 252.0 Hungary €/t 224.6 Italy €/t 259.5 TheNetherlands €/t 242.0 Table5.12:MaizepricesintheEUas of7/05/2011 Analysis of ending stock and conclusion Potential surplus still showing for 2010/11 and heavier outlook for 2011/12 the current problematic situation with maize plantings in the USA. By contrast, in the EU maizeplantingsarenowmostlycompleted.In China, a drought has momentarily compro- misedthecompletionofplantingsinlinewith farmers’originalintentions,butrainsattheend of April seem to have restored humidity levels inthesoil. Global maize stock at the end of 2011/12 is currently estimated equal to 13% of globaldemand,whichisrelativelylow.Even thoughrationingofdemandformaizeinthe animalfeedsectorhasalreadybegun,ithas nothappenedtoasufficientextenttoenable world supply and demand to balance. New crop maize prices therefore have no potential fordecreaseuntilharvestoutcomesarecertain. Onthecontrarytheystillhaveanincreasepo- tential in order to generate further reductions in demand. Any weather-related event with a negativeimpactonthe2011harvests(suchas a continuation of the difficulties with maize plantingsintheUSA)couldhaveanexplosive impactonprices. In the USA, the growth in maize production comparedwith2010(+24Mt)shouldbejust sufficienttooffsetthefallinopeningstock(-23 Mt).Demandformaizeinanimalfeedsisesti- mated to fall slightly in 2011/12 (-1 Mt); hu- man/industrialdemand(includingethanol)to increaseby2.6Mt.Americanmaizeexportsare forecast6.5Mtdownonthelevelof2010/11. WethereforeestimatethatUSmaizestocks willincreaseby6Mtto26Mtattheendof 2011/12,whichequatesto9%ofannualde- mand.IndeedUSmaizestockscouldactu- ally be significantly higher if the USA does notrenewthetaxcreditonethanolincorpo- rationinfuel. Atpresent,ourcurrentgrowthforecastforeth- anolconsumptionintheUSAisbasedonthe assumptionthatthetaxcreditwillberenewed after January 1 2012. A possible alternative scenario would be that the credit is renewed but for a smaller value. In this case, industrial maizeusageintheUSAcouldfallby2to4Mt (according to our estimates) and US ending stock would equate to around 10% of annual demand. TheoutlookforUSmaizein2011/12isthere- fore less tight than last month, following the transfer of export demand to the Black Sea countries. Nevertheless, harvest outcomes in Ukraine and Russia are far from certain and Russia’s potential return to the world market fromOctoberwillbeheavilydependentonthe wheat and barley harvest volumes it produces in2011.Furthermore,iftheUSmaizeharvest turns out to represent significantly less than 340Mt,thesituationintheUSAin2011/12 wouldbecomeextremelytight,withanexplo- siveimpactonprices. Consequently, maize prices have no poten- tialfordecreaseuntiltheharvestvolumesin 2011areassured.Onthecontrary,maizepric- eswillhaveanincreasepotentialinresponseto any weather-related concerns during the com- ingmonths. Crop year 2010/11 Since last month, we have reduced our fore- castformaizeimportsfromthirdcountriesby 0.3 Mt. Maize usage in animal feeds is revised downby0.3Mtandmaizeusageinbioethanol productionhasincreasedby0.15Mt. Maize stock on September 30 2011 has de- creasedslightlysincelastmonth(-0.1Mt)to6 Mt.Thebalancesheetisthereforestillshowing a small maize surplus of 1.6 Mt, which is split betweenRomania(0.3Mt),Slovakia(0.3Mt), Czech Republic (0.25 Mt), France (0.2 Mt) andAustria(0.2Mt). EU maize prices still have a decrease potential inordertogenerateariseindemand.However, thesituationontheworldmarketremainsvery tight, for both old and new crop outlooks, and in addition the situation for EU maize in 2011/12 is now much tighter than for the re- mainder of 2010/11. If world prices rise from theircurrentlevel,importedmaizewillbecome lesscompetitiveintheEU.Thiscouldgenerate a new reduction in imports and allow for a riseindemandforEUmaizeandreductionin the potential surplus without a corresponding needforEUpricestodecreasesignificantly. Nevertheless barley intervention stocks will continue to be released onto the internal mar- ket until the end of June 2011. This barley couldbeusedtoreplacemaizeinanimalfeeds creating downward pressure on EU maize prices. Crop year 2011/12 Maize stock on October 1 2011 is forecast at thesamelevelasonOctober12010.EUmaize productionisforecasttobe4.2Mtmorethan in 2010/11. Imports from third countries are forecast to decrease by 2 Mt compared with 2010/11duetothelesscompetitivepositionof importedthirdcountrymaizecomparedwith 2010/11(basedoncurrentpricesfornewcrop deliveries).MaizesupplyintheEUisforecast toincreaseby1.9Mtin2011/12. Demand for maize in animal feeds is forecast toriseby2.4Mtduetohighlevelsofon-farm maize usage and human/industrial demand is set to increase by 0.3 Mt (increases for starch and bioethanol sectors). Maize exports to third countries are forecast stable. Demand formaizeintheEU isthereforeforecastup 2.7 Mt compared with 2010/11. EU maize stockisforecasttodecreaseby0.9Mtthrough 2011/12to5.1Mt.Thislevelisslightlygreater (+0.6Mt)thantheminimumstockneededto comfortably supply the market until the next harvestarrives.Ourbalancesheetfor2011/12 thereforepointstoasmallsurplusattheendof 2011/12. At present new maize prices in the EU (November 2011 delivery) are on average 20 €/t cheaper than old crop (May 2011 deliv- ery).However,theoutlookin2011/12isnow muchlessheavythanthesituationin2010/11: this price differential should therefore narrow, either via an increase in new crop prices or a decrease in old crop prices. The world out- look in 2011/12 is still uncertain at this stage, whichcouldsustainnewcropprices.However, iffarmersplantingintentionsintheUSAhave been fully attained by mid-June and the crops develop correctly in Ukraine and Russia, the lesstight outlookfor2011/12couldallow for areductionin2011-cropprices.Bycontrast,if USplantingsforthe2011harvestdecline,then thiscouldleadtoasharpriseinnewcropprices.
  • 54. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 european union maize balances 54 100 120 140 160 180 200 220 240 20/1 14/4 7/7 29/9 22/12 16/3 8/6 Fob Rhine Fob Creil dvd Bordeaux French maize prices - July base, Crop 10€/t 100 120 140 160 180 200 220 240 5/1 30/3 22/6 14/9 Fob Rhine Fob Creil dvd Bordeaux French maize prices - July base, Crop 11€/t 2009/10 2010/11 2011/12 Spn. Fra. Spn. Fra. Spn. Fra. interventioncarry-in 0 -0 0 -0 0 -0 freecarry-in 1557 3706 1016 3462 1187 2885 ofwhichmarket stocks 1557 2515 1016 2508 1187 2293 total carry-in (incl. on farm) 1557 3706 1016 3462 1187 2885 production 3067 15497 3006 13569 3167 13804 ex-farmsales 0 13898 0 12166 0 12029 importsfromtheEU27 2961 385 2197 342 2361 205 importsfromnon-EUcountries 972 19 2498 133 2530 74 supply 8557 19608 8718 17506 9244 17272 exports to the EU 27 175 7154 137 4990 131 4753 exportstonon-EUcountries 1 415 1 124 1 97 overseasusage 96 137 96 150 96 150 humancons.+productexports 1625 2846 1694 3127 1657 3236 animalfeedconsumption 5616 5238 5574 5875 6143 5778 ofwhichincompoundfeed 4098 2747 4437 3488 4315 3438 seedsandwaste 28 355 28 355 28 355 demand 7541 16145 7531 14621 8055 14369 interventioncarry-out 0 -0 0 -0 0 -0 freecarry-out 1016 3462 1187 2885 1189 2903 ofwhichon-farmstocks 0 955 0 592 0 633 of which market stock 1016 2508 1187 2293 1189 2270 total carry-in (incl. on farm) 1016 3462 1187 2885 1189 2903 surplus/deficit 110 -110 -130 2010/11 Ger. B/L Den. Spn. Fra. Gre. Ita. NL Por. U.K. Aust. Pol. Hun. Cze. Slk. Sln. Rom. Bul. others EU carry-instock1/10/10 0 0 0 0 -0 0 0 0 0 0 -0 -0 3 -0 0 0 0 0 0 3 exportssales 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 openstockforexport 0 0 0 0 0 0 0 0 0 0 0 0 0 -0 -0 0 0 0 0 -0 interiorsales 0 0 0 0 0 0 0 0 0 0 0 0 2 0 0 0 0 0 0 2 openstockforinterior 0 0 0 0 0 0 0 0 0 0 0 -0 0 -0 1 0 0 0 0 0 intake&offers 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 wastes 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 nonopenstock 0 0 0 0 -0 0 0 0 0 0 -0 0 0 0 -0 0 0 0 0 1 Graphic5.2:Frenchmaizeprices(€/t) Table5.13:FrenchandSpanishmaizebalances–July-Junecropyears –for2009/2010,2010/11,2011/12 Table5.14:breakdownofEU27maizeinterventionstocksasof7/05/2011(kt)
  • 55. S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1S t r a t é g i e g r a i n s 2 2 1 - 1 2 M a y 2 0 1 1 stratégie grains Stratégie grains is available either on paper (mailed by post) or electronically (e-mail). StratégiegrainsisavailableinEnglish,French, SpanishandGerman. Subscriptionrates oneyear sixmonths Europ.union 1560€ 845€ International 1610€ 870€ ISSN1165-4120 / CPPAPNo:74317 publisher:AndréeDefois monthlypublication,publishedbyTallage SASaucapitalde40000€ RCSMelunB390618031 id.TVAFR15390618031 18,alléePrugnat, 77250Moret-sur-Loing,France Phone:+33164705430 e-mail:info@tallage.fr dépôtlégalàlaparution. printedbyTallageSAS 5 MONTHLY SUMMARY S T R A T É G I E G R A I N S 1 3 0 - 2 3 O C T O B E R 2 0 0 3 jected on-farm maize consumption has also been revised down in France and Italy. Since last month maize prices in the EU have continued to rise and have now reached parity with the price of imported Brazilian maize in Italy and the northern EU countries. We have therefore increased our forecast for maize imports from third countries by 2.6 Mt this month to 5.9 Mt. This esti- mate still has an increase potential, firstly because internal prices have not hit parity with the import price in all EU regions, and secondly because the internal price will need to be several euros more expensive than imported maize before large-scaleimportsaretriggered.Atpresent,wehaverestricted potential usage of the imported maize to the animal feed sector. Given the following three factors – smaller exportable maize surplus in France, reduced requirements in the animal feed sector and higher imports from third countries – we have reviseddownprojectedintra-EUmaizetradeby2.7 Mtsince last month. At the world level, US closing stock is revised up by 7 Mt thismonthbecausetheUSDAincreaseditsproductionfore- cast by 6.3 Mt to 259.3 Mt. Meanwhile demand for maize in the US animal feed sector was increased by 1.9 Mt but reduced by 0.6 Mt for other sectors. US maize prices have declined by 6 $/t since last month because the strongest in- fluence on the American market is the record US maize har- vest: as yet the market is not taking account of bullish fac- tors which could intervene later on (such as the high level of EU demand addressed to Brazil and the decline in Chinese maize stocks). The situation has evolved considerably since last month be- cause prices have risen and demand for maize in the animal feedsectorhasbeenpusheddownandthepricelevelatwhich imports would be triggered has now almost been reached. Despite these developments the maize balance still shows a deficitof1 Mtcomparedtothelevelofrequiredstock.Prices are therefore not likely to decline in the immediate future and could increase by a few more euros in order to attract a higher level of imports from third countries. Stratégie grains is available either on paper (mailed by post) or electronically (e-mail). Stratégie grains is available in English, French, Spanish and German. Subscription rate one year six months European union (ex. tax): 1 560 € 845 € International (ex. tax): 1 610 € 870 € stratégie grains® ISSN 1165-4120. CPPAP No: 74317. monthly publication. publisher : Andrée Defois. published by Tallage. SAS au capital de 40 000 € RCS Montereau B 390 618031 Id. TVA : FR 15 390618031 18, allée Prugnat, 77250 Moret-sur-Loing, France phone: +33 1 64 70 54 30 fax: +33 1 64 70 54 31 e-mail : info@tallage.fr dépôt légal à la parution. printed by Tallage SAS. Language: Ο French Version : Ο e-mail (PDF) Period: Ο One year Ο English Ο Paper (mailed by post) Ο Six months Ο Spanish Ο German First Name: _________________________ Last Name: _____________________________________ Company: __________________________________________________________________________ Address:____________________________________________________________________________ Code: __________________________ Town: ______________________________________________ Country: _______________________ If Europe, No VAT: ___________________________________ Phone: _________________________ Fax: _______________________________________________ E-mail address: ______________________________________________________________________ subscription form - to be returned to: Tallage, 18, allée Prugnat, 77250 Moret-sur-Loing, France. fax : +33 1 64 70 54 31 5555