High wheat prices in Europe hurt exports

Foreign media news on November 21: Strategic grain, a French consulting agency, issued a monthly report, which significantly reduced the EU wheat export forecast data for 2021 / 22, because high wheat prices will lead to a decline in exports and promote processing enterprises to use corn.

The strategic grain company lowered the EU soft wheat export forecast to 30.4 million tons, 1.6 million tons lower than the earlier forecast. In addition, the data of wheat feed consumption has also been reduced, so that the ending inventory of EU soft wheat in 2021 / 22 has been increased by more than 2 million tons to 12 million tons. The report points out that wheat prices are currently in a key position, especially French wheat, and prices may tend to fall in the future.

Wheat prices in Europe continued to rise this week to a 14 year high, due to strong international demand, possible further export restrictions in Russia, and worrying wheat crop conditions in major producing countries. However, the strategic grain company said that there is a lack of factors to push wheat prices higher, unless the current rainy weather in Australia causes serious damage to wheat, or Argentina restricts exports. French wheat prices face further pressure because Algeria’s adjustment of import standards is conducive to Russia’s export of wheat.

Corn is more competitive than wheat and barley, which also prompted strategic grain companies to increase the EU corn feed consumption by 1.5 million tons. EU corn harvest and attractive price will encourage the ethanol industry to increase corn consumption. At present, the profit of ethanol production is considerable. The strategic grain company also raised the forecast data of EU corn import in 2021 / 22 by 1.1 million tons to 15 million tons because of strong demand, although the EU domestic corn production is expected to reach a seven-year high of 67.8 million tons.

Source: Master Boyi

Post time: Nov-26-2021