Heatwave damages wheat crops in southern Europe
June 20 2017 06:22 PM
Heat
A girl refreshes herself at a fountain in Kiev during a hot day on Tuesday.

Reuters/Paris

* Southern Europe hit by heatwave, crops suffer
* Analysts cut crop estimates, notably top producer France
* European wheat futures surge to near 1-year highs
* Germany, Poland, UK heading for higher crops after rain


A heatwave hitting France and southern Europe will damage this year's wheat crops, mainly in top EU producer France and in Spain, while rainfall benefited crops in Germany, Poland and Britain where they are expected to be higher, analysts said.
Mounting concerns about the impact on crops of a heatwave in France, the European Union's biggest wheat grower and exporter, sent Euronext wheat futures rocketing to near one-year highs on Tuesday.
"It's clear that the very hot temperatures are degrading crop potential in Europe but it is too early to say by how much," the head of French consultancy Agritel Michel Portier said.
Analysts have lowered grain crop estimates in recent weeks, with Strategie Grains cutting its EU soft wheat crop estimate by 1.1mn tonnes last week to 141.6mn.
Agritel lowered its French soft wheat crop forecast to 36-37mn tonnes from 37.1mn seen last week, because of scalding damage, Portier said, adding that the forecast would need to be fine-tuned, depending partly on next week's weather.
Forecaster Meteo France currently sees temperatures falling back to average levels from the end of this week.
France last year harvested its lowest crop in decades at 28mn tonnes after poor spring weather, tumbling from a record 41mn in 2015.
In Spain, this year's extreme weather - from the frosts over the winter to recent record high temperatures - will mean a soft wheat crop of 3.7mn tonnes, down from 7.2mn last year, farmers association Cooperativas Agro-alimentarias said.
Northern Europe better off
In the EU's second largest producer Germany, wheat is developing well after a rainy June helped crop development after an unusually dry start to the spring.
"Overall the picture is satisfactory and Germany is on course for a good, average crop this summer as we have not had the weather extremes seen in other parts of Europe," one German grains analyst said.
"The next 2-3 weeks will be critical for yields and a mix of sunshine and rain is needed."
Germany's 2017 wheat crop will increase 3% on the year to 25.20mn tonnes, the country's cooperatives association estimated on June 14. This was up from 24.98mn tonnes the association had estimated in May.
In the fourth largest producer Poland, crops also benefited from recent rain, said Wojtek Sabaranski of analysts Sparks Polska, which estimates the country will harvest 11.3mn tonnes in 2017, up 1% on the year.
Britain's wheat crop appears in good condition with scope for a modest increase in production this year.
Trade estimates for this year's UK wheat crop range from around 14.5mn to 15.0mn tonnes, up slightly from last season's 14.38mn.
"Over the last two or three weeks, estimates have gradually begun to creep upwards," analyst Jack Watts of the Agriculture and Horticulture Development Board said. 



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