May 17, 2012

 

UK wheat exports drop despite further US purchase

 

 

UK wheat exports have fallen to a nine-month low, sapped by the worst month for shipments to the rest of Europe in at least two years, and putting trade back on track to fall within official estimates.

 

The UK, the European Union's third-ranked wheat producer, shipped 124,916 tonnes of the grain in March, customs data showed.

 

The figure was the lowest since July, the first month of the 2011-12 marketing season, although kept  bigger than the 104,000 tonnes exported in March last year by another shipment to the US.

 

A further 47,250 tonnes was shipped to the US, taking the total transported on the route in 2011-12 to 242,698 tonnes, the largest for an season on records going back to the 1960s.

 

The sales to the US represent a hangover from earlier in the season when US cash wheat values, lifted by rival grain corn and persistent drought in the southern Plains, were notably higher than Europe's, which were under pressure from a strong start to 2011-12 for Russian shipments.

 

US livestock producers also bought South American supplies in preference to the, then expensive, domestic wheat.

 

However, UK sales to the rest of the EU fell in March to 71,204 tonnes, the lowest figure since at least 2009-10.

 

Shipments to Spain, which enjoyed a strong harvest last year, slowed to a historically small 11,071 tonnes, with exports to the Netherlands dropping to 18,175 tonnes, a fraction of levels last autumn when low river levels forced Dutch feed groups to turn to supplies shipped over the sea rather than from central Europe.

 

Indeed, grain traders at a major European commodities house noted In March that "UK feed wheat is no longer competitive on the export market".

 

They added: "With high quality German milling no better than feed now, there is precious little chance of selling any more UK milling wheat for export."

 

The latest export figure fell below the ceiling of some 160,000 tonnes a month the UK had before forcing farm officials to revise down estimates for inventories at the close of 2011-12.

 

However, UK rapeseed exports remained strong in March, at a little under 135,000 tonnes, taking the total for 2011-12 to 769,705 tonnes already a record, and well above the 435,311 tonnes achieved in the whole of last season.

 

Demand for rapeseed on the Continent has been whetted by another year in 2011 of disappointing harvest in Germany, which lost to France the title of the EU's top producer of the oilseed.