August 16, 2006

 

Drought reduces wheat production in EU and Argentina

 

 

The USDA estimates EU-25 wheat production for 2006/07 to be 3 percent down on-year with heat and dryness reducing wheat production prospects in Germany and France.

 

EU wheat production stood at 119.4 million tonnes with acreage up 1 percent from last year.

 

The two countries together account for half of EU wheat production. Although both countries suffered from high temperatures in July, the wheat crop in France was already approaching maturity, thus damage was less severe than in Germany.

 

Wheat production in France for 2006/07 is estimated at 36.5 million tonnes, down 1 percent from last year, with the wheat harvest near completion by early August.

 

In Germany, wheat production is forecast to drop 11 percent from last year, to 21.0 million tonnes. Although wheat harvesting is progressing well in Germany, producers are reporting low weights and more shriveled kernels due to the hot conditions during grain fill.

 

The USDA estimates Ukraine wheat production for 2006/07 at 13.5 million tonnes, down 28 percent from last year, with favourable spring weather salvaging winter wheat which had earlier suffered unfavorable fall and winter weather.

 

Argentina's wheat production for 2006/07 is forecast at 13.5 million tonnes, up 8 percent from last year.

 

Harvested wheat area for 2006/07 is forecast at 5.30 million hectares, up 8 percent from last year.

 

Wheat production would have been higher if not for severe dryness in several provinces.

 

Planting has also been delayed for similar reasons. Last week's rain in southern Buenos Aires and La Pampa provinces helped planting progress, but more rain is needed to maintain the current yield forecast.

 

A spring drought delayed soy planting in Northeast China, particularly in eastern Inner Mongolia and western Heilongjiang and Jilin. Widespread rain in late June eased the drought, and additional showers in July and early August provided adequate to abundant moisture for crop development.

 

Periods of cool and cloudy weather this summer have slowed crop progress by several days, raising concerns about yield losses from an early frost. Dry and hot weather delayed the planting of summer soybeans on the North China Plain.

 

However, the crop has benefited from seasonable weather in July and August, and yield prospects are good.