At the beginning of June this year, Romanian wheat grower Costine Treherz was very optimistic, especially after the severe drought last year. But then it started to rain.
The impact of three consecutive weeks of relentless downpours on wheat quality far exceeded the scale of production. At the moment, Costine Trehertz believes that only half of the output can be used to produce food, and most of the remaining wheat will only be sold at low prices and used as feed. In a normal year, most wheat should be used as edible wheat.
Vincent Barak, an analyst at Strategic Grains, said that we expect EU wheat production to increase substantially. However, a considerable part of wheat may be reduced from edible grade to feed grade.
Although this may threaten sales to key markets such as North Africa, the increase in production is still worth celebrating. EU wheat exports are expected to grow by 11%, which is expected to regain market share from drought-affected North America and Russia. The floating export tariffs that Russia began to implement in June this year have also complicated Russia's wheat export trade. In addition, due to the tight global food supply, even low-quality wheat is in strong demand.
In recent days, parts of Europe have experienced the most devastating floods in decades. Scientists warn that as the earth warms, extreme weather events should increase. A National Meteorological Center said it is expected that the weather throughout Germany will be rainier than usual from July 26 to early August.
Paris milling wheat prices continued to soar, hitting their highest level in the next month, while the benchmark Chicago Board of Trade CBOT wheat prices recorded their biggest weekly increase in six years due to severe weather on both sides of the Atlantic.
Source: Master Boyi