EU: Positive outlook for grain and oilseed supplies

The EU agricultural sector continues to be under considerable strain due to the increase in the cost of energy and other inputs already before the Russian invasion of Ukraine, accentuated by the war and its consequences on agricultural production, prices and trade.

The latest figures confirm, however, that EU food supplies are not at risk. According to the European Commission data:

• The EU market situation for grains was positive until recently. The prices were very high for farmers and the harvest prospects quite good. Prolonged dryness in certain regions combined with heat waves during May gave rise to some worries. As a consequence, the latest Commission grain forecast has been reduced by over 2 million tonnes (from 295.8 to 293.1million tonnes). This reduction mainly concerns barley and maize (maize was so far forecast at record production levels) and does not affect soft wheat.
• The prospects for EU exports continue to be very positive. EU soft wheat exports in the next season are forecast to reach 38 million tonnes, the highest level ever. This confirms the possibility for the CAP to contribute to world food security. Total grain exports (wheat, barley, maize) could reach about 54 million tonnes (slightly below the 2019/20 record of 55 million tonnes).
• EU oilseed production is now expected to expand significantly thanks to the increased area (+6%, in particular with sunflower benefiting from the EFA derogation) with production forecast to expand by the same percentage. This positive development will permit the EU market to cope with lower oilseed availability from Ukraine.