September 22, 2004

Germany's Wheat Production May Surge 30%
 

Germany, Europe's third-largest wheat grower, may harvest 30 percent more of the cereal after farms recovered from drought last year, according to the U.S. Department of Agriculture.

Germany will produce 24.99 million metric tons of spring-and winter-grown wheat, compared with 19.26 million tons last year, the department's Foreign Agricultural Service reported. Total grain production, including barley and rye, will reach a record 50.1 million tons, up 27 percent.

"The main reason for the big crop were significantly improved yields due to proper planting conditions in the fall of 2003, a mild winter with hardly any winterkill, sufficient moisture supplies during spring, and an extended growing period of about two weeks due to cool temperatures in June and most of July,'' Dietmar Achilles, a U.S. embassy official in Berlin, said in the report. "Most of the wheat has been harvested under optimal conditions during sunny weather.''

A larger German wheat crop will add to global production that is forecast to exceed consumption for the first time in five years, thereby increasing competition for U.S. and Australian sales. Wheat futures prices in Chicago have declined 11 percent this year.

The "first shipments of high-quality baking wheat from northern German production regions are already on the way to the U.K.,'' Achilles said. Better grain crops in neighboring countries will reduce demand for German wheat within the European Union, he said.

Next year, more than 1 million tons of wheat are expected to be used to make ethanol, a fuel additive, following the start up of three new ethanol plants, Achilles said.