By Yusuf Khan
Europe's scorching summer is expected to wither production of corn within the region, with production expected to fall to a 15-year low, according to a new report.
French agriculture consultancy Strategie Grains said Thursday that it forecasts corn production to be just 53 million metric tons for the 2022-23 season--the lowest since 2007--as a consequence of the dry weather shrinking harvests across the E.U.
The overall grain harvest has also been revised 2.5 million tons lower than the previous report last month to 264.6 million tons--25.7 million tons lower than the prior year.
That said, wheat production has been more mixed, with stronger output in northern countries while southern production was more affected by the dry weather.
"The harvests in the EU 27 fall short of their five-year averages in 2022, mainly due to small growing areas," the consultancy said, estimating output at 124.1 million tons for 2022-23, down from 129.8 tons in 2021-22.
However, stocks for wheat will remain tight, with only 100,000 tons of surplus expected for the coming year.
Animal-feed demand is expected to slump 5% for corn, wheat and barley compared to the previous year at 148.6 million tons of total cereal consumption--with meat demand expected to slip on the dim macroeconomic outlook for Europe.
Prices for grains have eased, the consultancy said, but because of high production costs the fall may not be that great. Though this would be subject to recession concerns, which could hit demand further, as well as any rise in Ukrainian exports of grains.
Write to Yusuf Khan at yusuf.khan@wsj.com
(END) Dow Jones Newswires
09-15-22 0614ET
