by Agrimoney.com
Wheat exports from the Soviet Union will double next season – assuming no return of its devastating drought – at the expense of European Union and US shipments.
The US Department of Agriculture, in its first forecast for world wheat production and trade in 2011-12, estimated exports from producers such as Kazakhstan, Russia and Ukraine rebounding to 26.3m tonnes, from a drought-depressed 13.1m tonnes this season.
The recovery will still leave exports from a bloc renowned for its fierce competitiveness in export markets well below highs reached at the end of the last decade.
Nonetheless, the USDA, in its influential Wasde report, cited "increasing competition" from the former Soviet Union in forecasting an 18% slide, to 28.6m tonnes (1.05bn bushels), in American wheat exports in 2011-12.
And it forecast EU exports tumbling 19% to a four-year low of 18.0m tonnes.
Rain needed
However, the decline in European shipments will be reflected only in part in rising stocks, with the region's own livestock industry swallowing an increasing proportion of a crop which, at 136.6m tonnes, was pegged below some other estimates.
Strategie Grains has estimated the crop at 143.6m tonnes, with the USDA's European attaches coming up with a 141.25m-tonne number.
"Dryness prevailed in northern Europe during March and April and continues into May, with far below-normal precipitation levels and much-above-average temperatures," the department said.
"Dryness is reportedly interfering with fertilizer uptake by crops. Both wheat and rapeseed crops need rainfall soon to prevent sharp yield reductions in northern France, northern Germany, England, and western Poland."
Low winterkill
In Russia, meanwhile, although autumn sowings had proved disappointing, "winterkill is likely to be considerably lower than last year which will mitigate the impact of the sharp reduction in planted area", the USDA said.
"Winter crops have resumed vegetative growth throughout European Russia, and satellite-derived vegetative indices indicate that conditions are generally above average in the south and below average farther north."
The Wasde also highlighted static world demand for wheat imports, thanks largely to lower needs in North Africa, where many countries are expecting better crops this year.
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