Record French Wheat Crop Adds to Global Glut as Grain Piles Up

August 18, 2015 09:46 AM
Record French Wheat Crop Adds to Global Glut as Grain Piles Up

This year’s French wheat crop is shaping up to be a bin-buster.

France, the European Union’s largest grower, will produce a record 40.4 million metric tons of soft wheat, almost 8 percent more than last year, according to crops office FranceAgriMer. Hot, dry weather in June will also raise the quality of wheat, Paris-based farm adviser Agritel said.

The bumper French crop will add to ample world supplies, with the U.S. Department of Agriculture predicting stockpiles will climb to a record. The French harvest was 99 percent complete as of last week, and silo operators Senalia and Socomac both said this month they were halting wheat intake because bins are filling up.

“Ports are really overwhelmed with wheat and people need to export,” Caroline Bitton, an analyst at Agritel in Paris, said by phone on Monday. “France could see a very dynamic export pace this year.”

Milling wheat futures in Paris, the European benchmark, slid as much as 1.1 percent on Monday to 179.25 euros a ton on Euronext, the lowest in two months. The commodity has declined 11 percent this year.

Wheat production in France is expanding after farmers harvested the most acres on record since 1936, while yields are about 4 percent larger than average, Bitton said. While farmers harvested 37.5 million tons last year, just shy of the prior record set in 1998, poor grain quality hurt exports, she said.

While French output climbs, production at the EU level probably will be smaller this season. The European Commission predicts a harvest of 139.4 million tons, 6.3 percent less than last year. Germany, the EU’s second-biggest wheat grower, will harvest a smaller crop, as will the U.K., Poland, Romania and Spain, according to Brussels-based farm lobby Coceral.

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