September 26, 2011


EU to have bountiful corn output in 2011



In spite of summer heat that may restrict corn yield in the south-east region of EU, the bloc still continues to be set for a big corn production this year as harvesting gets under way in key producing countries, according to analysts and traders.


Corn crops in western Europe escaped the full impact of a spring drought that stressed earlier-sown grains and they have since benefited from plentiful summer rain that boosted plants during critical flowering and grain-filling stages.


"The good yields can be mostly explained by weather conditions during the summer," said Sophie Metge of French-based analysts Strategie Grains.


Earlier this month, the firm raised by one million tonnes its forecast for this year's EU corn grain crop to 61.7 million tonnes, compared with 55 million last year, and said there was potential to increase this by another 1.5 million tonnes if harvest results were favourable.


In France, the EU's top producer, the final production level would be influenced by the extent of switching from corn grain to corn fodder by livestock farmers, analysts said.


Livestock breeders, notably in Brittany, could choose to keep less corn as fodder after improved yield prospects meant they faced less of a squeeze than in the spring when a drought parched fields and left them short of hay, Metge said.


"Whatever the case, we are sure to have a good crop," Metge said of the French harvest.


The farm ministry's estimate for the 2011 crop is 14.1 million tonnes, with an average yield of 9.35 tonnes a hectare, but analysts and traders are closer to 15 million tonnes.


Growers group AGPM and crop institute Arvalis expect a record yield around 10 tonnes a hectare.


The harvest outlook in Italy was also bright, with indications of higher yields in initial harvesting coming on top of a sharp rise in the planted area.


In Lombardy, one of the main growing regions with about 365,000 hectares, harvesting is almost over and yields are estimated to be 10% higher than usual, according to farmers body Coldiretti.


The farm ministry estimates corn plantings rose to over one million hectares from about 927,000 in 2010.


It has yet to issue a crop forecast for this year, after estimating 2010 production at 8.6 million tonnes. Strategie Grains expects the 2011 Italian crop to reach 9.5 million.


Spain was similarly expected to reap a larger crop this year, with an official forecast calling for a 13% rise in output to 3.7 million tonnes.


Farmers planted more this year, encouraged by high prices, and they say yields from the roughly 10% of the harvest completed show yields between nine and 10 tonnes a hectare.


"The harvest is going very well, yields are very good, as they are across Europe this year. There may have been some problems with water in Aragon, but on the whole it is very good," said Antonio Caton, a grain technician with Farm Co-operatives, which markets about five million tonnes of cereal a year.


In Germany, corn crops were expected to have been helped both by rain and more recently from summer-style weather that favoured ripening.


"The rain which caused so many problems for wheat and barley farmers this summer was good for both grain and silo corn," the analyst said. "I think the yields could be even more than forecast by the ministry."


Germany's farm ministry forecasts the corn crop will rise to 4.47 million tonnes from 4.21 million tonnes last year, with 6.3% increase in area to 478,000 hectares and a rise in yield to 9.3 tonnes a hectare against 9.1 tonnes.


However, in the east of the EU, hot and dry spells during the summer may have hurt yields.


In Hungary, farmers estimate a lack of rainfall in recent weeks has likely left the harvest well below a current official forecast of 8.1 million tonnes.


"We believe it will be 10% lower than the last official crop estimate," Jozsef Vancsura, chairman of the Association of Hungarian Grain Growers said. "That means about 800,000 tonnes less, or 7.3 million tonnes."


Harvesting has already started in southern regions of Hungary but it is still in an early phase.


Last year, Hungary harvested just under seven million tonnes.


Romania, another large corn producer, also saw hot spells this summer that could weigh on corn yields, Metge said.

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