June 8, 2009

Grain farmers in Spain have started to harvest wheat in the south and reiterated projections that the grain crop would fall by some 30 percent and imports rise, although they expect an exportable surplus of durum wheat.

Quiliano Jaraiz, spokesman for farmers' union Asaja said harvest was 12 percent complete in southerly Andalusia, which normally accounts for some 30 percent of Spain's wheat, most of it durum.

 

Asaja predicted that Spain's grain harvest will decline to 15.4 million tonnes from 23.2 million last year due to farmers' less sowing and scant rainfall in April and May.

 

Jaraiz said falling grain prices last year and expensive fertiliser and fuel put off farmers from planting if they get yields of less than 2.5 tonnes per hectare.

 

However, the union said the drop in grain output would be partly cushioned by record carry-over stocks of 4.7 million tonnes. Imports in the crop year beginning on July 1 are seen more than 9 million tonnes.

 

In a statement, Asaja said "cereal consumption, animal and human, is almost 30 million tonnes, Spain will have to increase imports to meet demand which almost doubles output."

 

Grain harvests are difficult to predict in Spain, because they can vary from 13 million to 23 million tonnes.

 

Asaja's predictions follow estimates by local authorities that the wheat and barley harvest would fall by half in Spain's northern grainbelt region of Castilla-Leon, which provides 50 percent of Spain's output of both products.

 

Spain's Agriculture Secretary Josep Puxeu last week projected an increase in corn output -- due to abundant irrigation reserves -- would offset a fall in wheat and barley and put the total crop at 18-20 million tonnes.

 

Merchants are pessimistic and are predicting a total crop of 13.5 million tonnes, while dealers expect 17-18 million.

 

Asaja see a more moderate fall in durum wheat, however, of 8 percent to a harvest of 1.05 million tonnes and expect Spain to export 400,000 tonnes, much of it to Italy to make pasta.

 

A fall in the Italian crop will add value to quality durum wheat harvested in Spain, which will be an origin of choice for the Italian semolina industry, Asaja said.

 

Exporters and warehousers separately announced that they will hold a two-day exchange on June 8 in southeastern port Seville to deal in the durum crop, 80 percent of which is grown in Seville.

 

Seville handles 200,000-300,000 of durum a year and organisers of the Andalusian Durum Wheat Exchange added in a statement that they estimated Andalusia's share of the crop this year will fetch some 200 million euros (US$283.4 million).

 

Durum wheat is currently changing hands for about 240 euros a tonne in Andalusia.