March 31, 2009
EU 2009-10 wheat plantings seen down 4 percent on-year
European Union wheat plantings for the 2009-10 crop are expected to be down 4 percent on the year due to lower prices, Keith Flury, analyst at German-based firm F.O.Licht told Dow Jones Newswires Monday (March 30).
Speaking on the sidelines of the International Grain Trading Conference in Egypt, Flury said: "Producers realize that margins are razor thin. Currency is a big issue, especially in the future as inflationary pressure on the dollar is potentially going to soften that currency."
A stronger euro against the dollar lowers E.U. competitiveness on the international market.
The EU is also expected to see a fall in trade in 2009-10 due to improved crops in north Africa - meaning that EU wheat has fewer destinations, said Flury.
F.O. Licht expects global wheat plantings to fall by between 2 percent and 5 percent on the year, although Flury said it was difficult to make an accurate prediction at this stage.
Farmers switching from wheat to oilseeds in the US have been one of the drivers of the reduced world plantings, said Flury.
Last week, the International Grains Council estimated world wheat plantings for 2009-10 would be down 1 percent on the year - but traders said this was a conservative figure.
