September 8, 2008

 

 

Feed users in the EU have reason to cheer this autumn as they can expect a bumper corn crop which should cut animal feed costs and reduce imports from Brazil, traders said last week.

 

The EU's corn harvest is expected to rise 25 percent this year to 59.7 million tonnes, according to EU grain analyst Strategie Grains. Germany's largest grain trading house Toepfer International expects a crop of 57.2 million tonnes.

 

Toepfer estimated the EU will import only 4 million tonnes of Brazilian corn in the 2008/09 season, a third from levels seen in 2007/08.

 

High prices last year prompted farmers across Europe to greatly expand planting and prices have dropped sharply as the arrival of the large crop approaches.

 

Paris corn futures have fallen more than 25 percent since the end of June while German corn prices have fallen a similar 25 percent since early August. For the latter, prices have fallen to EUR 170 a tonne for September delivery from 225 a tonne in early August.

 

Germany's corn crop is expected to see a 28-percent increase in its corn crop to 4.8 million tonnes.

 

France, the EU's largest corn producer, is expected to see a more modest increase of 100,000 tonnes to 14.5 million tonnes. The harvest would have been bigger if not for poorer yields.

 

But Hungary, the major corn exporter, is expected to reap twice as much corn as it did last year, harvesting 8.5 million tonnes compared to 4 million tonnes in 2007, according to Toepfer.

 

In Italy, Europe's second-largest producer, the crop is expected to be 10 percent to 20 percent larger than last year's 9.85 million tonnes.

 

The larger harvests means the EU would most likely turn to Ukraine for supplies if needed rather than to import from Latin America.

 

Russia expects a record corn crop amounting to about 6 million tonnes this year due to an increase in acreage and higher yields.