Impact of Adverse Weather Conditions on Global Grain Markets

post from 5 June 2024

In this interview, Maryna Marynych speaks with Maxence Devillers, a Grain and Oilseeds Analyst at Argus Media France, about the outlook for grain production and trade for the 2024/25 season. Devillers discusses the impact of adverse weather on Russian and French wheat crops, estimating a significant reduction in Russian wheat production to around 82 million tons. He also highlights the challenges faced by the French crop due to wet weather, resulting in reduced planting and lower yield potential. Despite high stocks from previous seasons, Devillers anticipates tighter global supply and increased demand from the MENA region. He expects European exporters to fill some of the gaps left by reduced Russian and Ukrainian exports, with a potential rise in corn and barley trade.

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In an interview with Maryna Marynych on GetTalks, Maxence Devillers, a Grain and Oilseeds Analyst at Argus Media France, discussed the outlook for grain production and trade in France, Europe, and globally for the 2024/25 season. Key points are the following:
Russian Wheat Crop Reduction: Russia’s wheat production estimate dropped from 92-93 million tons to just under 82 million tons due to adverse weather conditions across various regions.
Global Supply and Demand Impact: Despite high carryover stocks in Europe and Russia, the production losses will negatively affect global wheat supply and demand. Lower wheat availability will likely lead to reduced feed demand and a shift towards barley and corn.
French Winter Crop Conditions: Adverse weather conditions led to the worst crop conditions in five years in France, affecting the yield potential. Similar issues were reported in Germany and the UK.
French Wheat and Barley Estimates: For the 2024/25 season, French wheat production is estimated at 29-29.2 million tons, and barley production is expected to be around 12 million tons.
European Export Dynamics: The reduction in Russian and Ukrainian wheat exports is expected to increase demand for European origins, particularly from Eastern EU countries like Romania and Bulgaria. Western EU countries will also play a crucial role in balancing global supply.
French Export Estimates: French wheat exports within the EU are estimated at 6.3-6.5 million tons, with exports to third countries around 7.5-7.6 million tons. Barley exports are expected to be around 3.5 million tons within the EU and 3.3 million tons to third countries, depending on Chinese demand.
Competition Between Crops: The price spread between wheat and corn has increased due to weather impacts, favoring corn. A rise in global corn trade is expected if availability meets demand. Other feed crops like pulses and meals may also see increased demand based on protein content and trade flows.
Global Demand Trends: Chinese demand is expected to remain stable, though free trade zones’ impact needs monitoring. India might import around 3 million tons of wheat, depending on import duty policies and trade agreements with Russia. The MENA region, particularly Morocco, Algeria, and Egypt, is expected to see record import volumes due to poor local harvests and financial capabilities.