Report Highlights:

The EU28 grain harvest is now under way in most Member States. Following an extended period of dry weather across much of the region in the spring, which continued and worsened into the early summer in the west, attention is focusing on the size and quality of the wheat and barley crops as well as the development of the corn crop. With the weather over the coming weeks remaining a key influencing factor, the total MY2015/16 EU28 grain crop is revised to just over 305 MMT, down nearly 21 MMT on the record set in MY2014/15. However, if realized, this will still be nearly 2 MMT larger than the crop of MY2013/14 and the third largest EU28 crop on record.

Executive Summary An extended period of dry weather across much of the EU28 in the spring continued and worsened into the early summer in the west. This has focused attention on the size and quality of the wheat and barley harvests, which are now under way, as well as the development of the corn crop. The weather is also reported to have increased pest concerns, exacerbated by the restrictions on the use of certain insecticides.

The spring was characterized by warm and dry conditions across much of the EU28 which, based on early harvest indications, was good for crop development in Bulgaria and Romania. Similarly, the Hungarian grains crop is reported to be in good condition, buoyed by recent rains. In contrast, Spain experienced a sustained period of unseasonably high temperatures in May and into June which has had a negative impact on crops in that region. June has also been very hot and dry in the UK and even more so in France. The impact has been mixed - while winter crops have largely been unaffected, a close eye is being kept on the spring crops for which a bit of rain would be welcome, and in France there is growing concern for the development of the corn crop. Elsewhere, the need for rain in parts of Germany and Poland is tempered by the impact it might have on harvest activity and grain quality, while in Scandinavia and the Baltic States conditions are reported to be generally favorable.

Although the total areas planted to individual crops in the EU28 are little changed year-on-year, reduced yield expectations following the very high numbers seen in MY2014/15 mean total grain production in MY2015/16 is now forecast at 305.2 MMT, down nearly 21 MMT on the record MY2014/15 crop. However, if realized, this will still be nearly 2 MMT larger than the crop of MY2013/14 and the third largest EU28 crop on record. Much will, necessarily, depend on the weather over the coming weeks, not just for crop development but also for harvest volume. Within this total, wheat production is forecast at 148.5 MMT, barley at 57.5 MMT and corn at 66 MMT, down 8.3 MMT, 3 MMT and 9.5 MMT, respectively, year-on-year. Of these three crops, not only is the decline the most significant for corn but it is also this crop where the outlook looks the most uncertain given the dry conditions in much of the EU28 thus far in 2015. While the concern is strongest in France where the crop is already forecast down over 3.5 MMT year-on-year, corn crops across the EU28 are forecast to be smaller than they were in MY2014/15. Rye and mixed grain production are also both forecast down in MY2015/16, by 650,000 MT and 500,000 MT, respectively, to 8.2 MMT and 16.3 MMT. Only oats production is currently forecast unchanged year-on-year. At 7.9 MMT, a forecast increase in area and production in Finland is largely offsetting a decline in a number of other Member States, including the UK.

The total supply of grains in the EU28 in MY2015/16 is forecast at 354.4 MMT, a large increase in carry-in stocks from the record MY2014/15 wheat and corn crops and an increase in forecast imports of corn in MY2015/16 partially offsetting the reduced size of the crop. However, total supply is still over 12 MMT down year-on-year.

Total EU28 grains consumption is currently forecast at just over 285.5 MMT in MY2015/16, unchanged on MY2014/15 meaning ending stocks are once again forecast to decline. Within total EU28 consumption, the unprecedented pace of EU wheat exports in MY2014/15 means they are now expected to have reached 34.5 MMT by year end. Following a prompt start to the MY2015/16 campaign, wheat exports are currently forecast to reach 30.5 MMT in MY2015/16. Although 4 MMT down year-on-year, if realized this would still be a considerable export volume given that MY2013/14 was the first year the EU28 exported more than 30 MMT of wheat. Barley exports are also forecast to decline nearly 2 MMT year-on-year and corn exports 1 MMT. Following the increase in EU28 feed use of grains in MY2014/15, MY2015/16 is currently forecast little changed. Similarly, Food, Seed & Industrial (FSI) use of grains, which has been following an upward trend in recent years due to increased use in the latter sector, is forecast steady in MY2015/16.

Country specific

Following a period of favorable weather and good crop development through the spring, very high temperatures in France in the last week of June and first weeks of July have caused concern for some of the crops. While the weather is not reported to have had any significant impact on winter barley – the French harvest is under way and early indications are of excellent quality and sizable yields - the lack of rainfall since mid-May is expected to negatively affect the spring barley crop, especially by rising protein which is not desired for malting barley. For wheat, the French harvest started two weeks earlier than usual in the south of the country and quality is reported to be good to excellent. However, in the north and east of the country, the very warm weather is expected to have impacted the filling of the grain, leading to a lower specific weight should there not be a milder period prior to harvest. Overall, French wheat production is forecast marginally up year-on-year, yields little changed but on a larger planted area, and strong exports are currently forecast. Of most significance is the impact the heatwave has had on the development of the French corn crop which is revised down nearly 1 MMT on previous forecasts. This may be revised down further, especially if producers, fearful of a lack of forage due to the drought, switch from grain to silage corn.

The weather has been a similar story in the UK, generally favorable through the spring with a hot spell in late June and early July. While this has caused some moisture stress for crops on lighter soils, it is not yet reported to be of any serious concern. An upward revision to the area planted to wheat has correspondingly increased forecast wheat production while a downward revision to the area planted to barley means a reduction in the forecast barley production in MY2015/16. Yield forecasts are currently unchanged on earlier forecasts.

Austria is reporting good grain quality and average yields, putting wheat and barley production marginally down-year-on-year. The only significant change is a reduction in the previously forecast area planted to corn due to producer concerns of higher pest risks due to the ban on the use of neonicotinoids.

In the Czech Republic, dry weather and high temperatures have resulted in a slightly earlier start to harvest.

Germany has experienced contrasting fortunes. While central and eastern Germany was very dry through the spring and into early summer, parts of the south of the country experienced excessive rain. The barley harvest started about a week ahead of normal in the south of the country. With the latest official data showing a slightly higher area planted to barley than previously forecast, and early indications of a slight reduction in yield year-on-year, production is forecast little changed on earlier forecasts. In contrast, the outlook for German wheat production is forecast down on earlier projections.

Latest official data shows a slightly lower than expected area planted to mixed grains while yields are forecast lower than MY2014/15 but above the five year average. It should also be noted that official German FSI wheat use data for MY2013/14 has been revised upwards meaning German feed use was previously overestimated. This change has been carried over to the following years.

In Poland, crop condition is reported to be variable, depending on the region. In the main grain production areas, dry weather conditions at the beginning of July were followed by storms and showers. They have not increased soil moisture to any significant degree but have increased the threat of pest activity and fungi diseases. Winter grains are in much better condition than spring varieties, especially spring barley which has been affected by drought on the fields with light soils. The overall quality of grains is assessed as lower than last year and yields are down. As such, despite the higher total planted acreage, total grain production in Poland is forecast over 5 per cent lower year-on-year.

Estonia is expecting another record harvest in 2015. Weather conditions have been excellent for crop development with a mild winter minimizing winter kill.

In Latvia, the wheat crop is forecast to increase year-on-year. Weather conditions have been favorable for the winter grains but less so for spring varieties and the latter are expected to yield lower in MY2015/16. This is especially the case for the barley crop which is forecast significantly smaller than MY2014/15.

In the central regions of Lithuania a severe lack of moisture in soil has been reported. It is forecasted that dry weather conditions will diminish the volume of almost all kinds of grain crops except rye.

Romania has experienced mixed weather conditions. The north-east and east of the country experienced dry weather in in the spring with some negative impact on the development of the wheat crop reported while, at the same time, wet weather in the south of the country delayed the application of plant treatments. That said, the conditions have proved favorable for the barley crop and the winter barley harvest has almost been completed with production in line with previous forecasts. With the end of June bringing rain to much of the country, a dryer start to the month of July has seen the wheat harvest now get under way and while production is now forecast marginally below previous forecasts, the overall outlook is positive. For corn, the weather first delayed planting and then led to some development concerns but the aforementioned June rains have been very beneficial such that production is not currently forecast to be negatively affected.

In Bulgaria, the late spring dry spell is reported to improved wheat quality, albeit with a limited negative affect on yields. The latter is certainly below those seen in MY2014/15 when production hit record levels. For barley, the harvest is under way in the south and initial yield results are reported to be encouraging - but again below MY2014/15 – but with improved quality. The increase in the area planted to corn, while up year-on-year, is below previous forecasts due to weather-related delays. The crop is reported to have established well and yields are currently forecast to be above average.

The Hungarian wheat yield is lowered on previous forecasts. The extremely wet fall saw saturated soil conditions hinder the development of plants and a very dry spring had a further negative impact. That said, crop quality is forecast to be improved as compared to MY2014/15. For barley, a year-on-year increase in harvested area but reduced yield is expected to see production little changed. Quality is currently reported to be good to average. The corn area is little changed year-on-year. While the dry spring weather is not reported to have hindered plant development to any significant degree, soils are unfavorably dry. Moreover, pests such as the corn rootworm (Diabrotica virgifera virgifera) and the European corn borer (Ostrinia nubilalis) are reported to be a significant challenge this year, helped by the recent drought period.

Good yields were expected for most of Spain's grain growing regions until early May when high temperatures and lack of precipitation significantly reduced harvest expectations. Spain's central plateau was most affected by the hot weather as the winter crop cycle had almost ended when the unusually high temperatures withered the grains in the south. Some northern grain growing regions expect average yields thanks to the milder temperatures and rain during the first half of June.

Wheat

2013/2014

2014/2015

2015/2016

Market Begin Year

Jul 2013

Jul 2014

Jul 2015

European Union

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Harvested

25883

25875

26711

26800

26497

26600

Beginning Stocks

10815

10815

10071

10106

14720

14506

Production

144415

144550

156449

156800

147875

148500

MY Imports

3974

3974

6000

6000

6500

5500

TY Imports

3974

3974

6000

6000

6500

5500

TY Imp. from U.S.

657

717

0

0

0

0

Total Supply

159204

159339

172520

172906

169095

168506

MY Exports

32033

32033

34700

34500

31000

30500

TY Exports

32033

32033

34700

34500

31000

30500

Feed and Residual

49500

49000

54500

54500

55000

55000

FSI Consumption

67600

68200

68600

69400

69000

68850

Total Consumption

117100

117200

123100

123900

124000

123850

Ending Stocks

10071

10106

14720

14506

14095

14156

Total Distribution

159204

159339

172520

172906

169095

168506

(1000 HA) ,(1000 MT)

Barley

2013/2014

2014/2015

2015/2016

Market Begin Year

Jul 2013

Jul 2014

Jul 2015

European Union

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Harvested

12407

12275

12436

12400

12500

12450

Beginning Stocks

5071

5071

5696

5594

6193

5029

Production

59722

59620

60197

60500

57239

57500

MY Imports

44

44

100

85

100

100

TY Imports

58

58

175

175

50

50

TY Imp. from U.S.

0

0

0

0

0

0

Total Supply

64837

64735

65993

66179

63532

62629

MY Exports

5741

5741

9300

9000

7500

7000

TY Exports

4926

4926

8800

8800

7500

7000

Feed and Residual

38000

38000

35000

36500

35000

35000

FSI Consumption

15400

15400

15500

15650

15500

15700

Total Consumption

53400

53400

50500

52150

50500

50700

Ending Stocks

5696

5594

6193

5029

5532

4929

Total Distribution

64837

64735

65993

66179

63532

62629

(1000 HA) ,(1000 MT)

Corn

2013/2014

2014/2015

2015/2016

Market Begin Year

Oct 2013

Oct 2014

Oct 2015

European Union

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Harvested

9663

9665

9530

9550

9487

9500

Beginning Stocks

5147

5147

6820

6798

8845

9048

Production

64655

64635

75025

75500

65773

66000

MY Imports

15919

15919

8500

8000

14000

12000

TY Imports

15919

15919

8500

8000

14000

12000

TY Imp. from U.S.

1337

1337

0

0

0

0

Total Supply

85721

85701

90345

90298

88618

87048

MY Exports

2401

2403

3500

3000

2500

2500

TY Exports

2401

2403

3500

3000

2500

2500

Feed and Residual

58000

58000

59000

59500

61000

59000

FSI Consumption

18500

18500

19000

18750

19000

18750

Total Consumption

76500

76500

78000

78250

80000

77750

Ending Stocks

6820

6798

8845

9048

6118

6798

Total Distribution

85721

85701

90345

90298

88618

87048

(1000 HA) ,(1000 MT)

Rye

2013/2014

2014/2015

2015/2016

Market Begin Year

Jul 2013

Jul 2014

Jul 2015

European Union

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Harvested

2578

2550

2117

2100

2224

2175

Beginning Stocks

795

795

1213

1153

1127

958

Production

10160

10100

8849

8780

8556

8200

MY Imports

77

77

100

75

50

50

TY Imports

96

96

90

90

50

50

TY Imp. from U.S.

0

0

0

0

0

0

Total Supply

11032

10972

10162

10008

9733

9208

MY Exports

169

169

185

200

150

175

TY Exports

201

201

175

175

150

150

Feed and Residual

4900

4900

4450

4450

4100

3900

FSI Consumption

4750

4750

4400

4400

4500

4400

Total Consumption

9650

9650

8850

8850

8600

8300

Ending Stocks

1213

1153

1127

958

983

733

Total Distribution

11032

10972

10162

10008

9733

9208

(1000 HA) ,(1000 MT)

Oats

2013/2014

2014/2015

2015/2016

Market Begin Year

Jul 2013

Jul 2014

Jul 2015

European Union

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Harvested

2652

2590

2543

2500

2583

2550

Beginning Stocks

901

901

909

864

917

744

Production

8395

8300

7903

7750

7838

7900

MY Imports

4

4

5

5

5

5

TY Imports

3

3

5

5

5

5

TY Imp. from U.S.

0

0

0

0

0

0

Total Supply

9300

9205

8817

8619

8760

8649

MY Exports

316

316

225

200

150

160

TY Exports

291

291

225

225

150

160

Feed and Residual

6400

6350

6000

6000

6100

6000

FSI Consumption

1675

1675

1675

1675

1675

1675

Total Consumption

8075

8025

7675

7675

7775

7675

Ending Stocks

909

864

917

744

835

814

Total Distribution

9300

9205

8817

8619

8760

8649

(1000 HA) ,(1000 MT)

Sorghum

2013/2014

2014/2015

2015/2016

Market Begin Year

Jul 2013

Jul 2014

Jul 2015

European Union

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Harvested

135

135

145

145

135

135

Beginning Stocks

5

5

19

13

17

44

Production

703

700

863

875

760

800

MY Imports

193

193

100

125

100

150

TY Imports

186

186

100

100

100

150

TY Imp. from U.S.

25

25

0

0

0

0

Total Supply

901

898

982

1013

877

994

MY Exports

2

3

20

20

5

2

TY Exports

18

18

5

5

5

2

Feed and Residual

860

860

925

925

825

950

FSI Consumption

20

22

20

24

25

24

Total Consumption

880

882

945

949

850

974

Ending Stocks

19

13

17

44

22

18

Total Distribution

901

898

982

1013

877

994

(1000 HA) ,(1000 MT)