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Strategie Grains cuts EU soft wheat export forecast

Consultancy Strategie Grains has made a sharp cut to its forecast for European Union soft wheat exports, citing a sluggish start to the season because wheat from EU origins is proving uncompetitive against Russian wheat.

In its monthly report, the consultancy said it now expects EU soft wheat exports to reach 30.1 million metric tons this season, down 700,000 tons from its August forecast and well below 2022/23 exports revised upwards to 32.3 million tons.

“The prices of EU wheat origins will need to fall closer to the Russian wheat price before any significant surge in EU exports could be expected,” Strategie Grains said.

The Euronext soft wheat futures BL2c1 benchmark hit a three-month low this week as competition from Black Sea supplies hung over the market.

EU soft wheat exports so far in 2023/24 were running 27% below the level for the same period a year earlier, weekly EU data showed on Tuesday.

The consultancy raised most of its forecasts for EU cereal production, including soft wheat that is now expected at 125 million metric tons in the 2023/24 season, up from the 124.7 million tons forecast in August and slightly below an estimated 125.3 million in 2022/23.

The most important production revision was for the maize crop, mostly yet to be harvested.

The maize crop is now expected at 59.6 million tons against 58.7 million tons forecast last month and now 7.3 million tons above the previous year’s crop, with Strategie Grains citing “rather good” crop development across the EU, except in Romania and Bulgaria.

The consultancy had revised down its EU cereal crop forecasts for several months as the bloc faced drought and heatwaves.

Strategie Grains raised its outlook for the EU barley harvest to 47.4 million tons from 47.2 million tons last month, but the forecast remained 4 million tons below last year’s production and would be at the lowest level since 2011.
Source: Reuters (Reporting by Sybille de La Hamaide, Editing by David Goodman)

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