World Grain - October 2020 - 32

FEATURE: WEATHER-HIT CROP MEANS LOWER EU GRAINS EXPORTS

and increased imports, our domestic milling wheat
prices have been moved higher. However, the price of a
ORDIRQWKHVKHOIZLOOEHIDUPRUHLQÀXHQFHGE\WKHQHHG
for supermarkets to keep consistent prices for consumers amid the record-breaking recession we face (and
SRVVLEOHGHÀDWLRQ´
Bread prices have actually fallen during 2020.
Alex Waugh, director general of the National
Association of British and Irish Millers (nabim), the
industry's trade body in the UK and the Republic
of Ireland, explained, in response to questions from
SMALLEST CROP IN 40 YEARS
World Grain, that "as a result of the smaller UK
In Britain, the smallest wheat crop for 40 years made wheat crop, likely to be down by around 35% comripples in the mainstream media, with the Murdoch- pared to last year, we are expecting to import more
owned Sky News proclaiming that "worst UK wheat wheat for breadmaking."
KDUYHVWLQ\HDUVSURPSWVÀRXUSULFHKLNHIHDUV´
"The exact amount will depend on the quality of the
"Brexit, the coronavirus pandemic and small, low- UK harvest, which is not yet complete, but we expect
quality crops have created a 'triple whammy' for farm- imports to be at least double the normal level," he said.
ers, millers and bakers," Sky News said in an Aug.
1DELPLVQRWH[SHFWLQJVLJQL¿FDQWFKDQJHVWRWUDGH
23 report.
ÀRZVLQJOREDOWHUPV:DXJKH[SODLQHGWKDW³WKH8.
The British Broadcasting Corp. (BBC) came out will be a net importer rather than an exporter, and shipwith "bread price may rise after dire UK wheat har- ments from France may reduce."
vest," on Aug. 26.
"While these are important on a local level, the dif"Farmers say that the extreme weather over the ferences will be easily made up from stocks and good
last year is likely to mean wheat yields are down by crops in other exporting countries," he said. "When
up to 40%," the BBC said. "As a result, some mill- WKHUHLVDVXSSO\GH¿FLWLQWKH8.PLOOHUVKHUHWUDGLHUV KDYH DOUHDG\ LQFUHDVHG WKH SULFH RI ÀRXU E\  tionally turn to Germany and the Baltic states for supand they warn a no-deal Brexit could push up prices SOLHV7KLV\HDULVXQOLNHO\WREHGL൵HUHQW
even further."
"However, the normal pattern of supply could be disIn a commentary of Aug. 26, David Eudall, head of torted if the UK and the EU fail to reach a trade agreeMarket Specialists (Arable), at the UK's Agriculture ment in 2020, with import duties of £79 (US$105) per
and Horticulture Development Board, put the rise in tonne being applied on grain traded from one to the
the price of wheat in context.
other after Jan. 1, 2021. If this looks likely, or even
"The price of wheat does not translate directly and possible, it will result in grain being moved before the
proportionately to the price of bread," he said. "Wheat GHDGOLQHDQGSXWLQWRDEX൵HUVWRFNLQRUGHUWRGHOD\WKH
prices have a much more direct and pronounced impact impact. This will add substantial extra cost, and come
RQÀRXUEXWWKHVXEVHTXHQWEDNHU\SURGXFWLRQSURFHVV- with logistics issues, but will still be less expensive
es, ingredients, packaging, marketing and transporta- WKDQSD\LQJWKHIXOOWDUL൵´
tion mean that wheat isn't directly related to the price
of bread.
LESS CHANGE FOR OILSEEDS
"We estimate that the value of wheat in an 800-gram According to COCERAL, there's been less change for
loaf of bread stands at only 11%. With a small harvest UDSHVHHGZLWKDQ(8SOXV8.¿JXUHRIPLOOLRQ
32

October 2020 / World Grain / www.World-Grain.com

©ruslan_khismatov - stock.adobe.com

prospects in southern EU," the report said. "Winter
crops (wheat, rapeseed) area was negatively impacted
E\ WKH GL൶FXOW VRZLQJ FRQGLWLRQV DQG FURS GHYHORSment was hampered by the dry and warm spring in several parts of the EU.
"For 2020-21, total use of cereals for feed is expected to decline slightly at 162.6 million tonnes
(-0.2% year-on-year), mainly due to a slight decrease
of production in the animal sector following the
COVID-19 outbreak."


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World Grain - October 2020

Table of Contents for the Digital Edition of World Grain - October 2020

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