AUSTRALIA is not the only continent suffering through drought at present.
European grain trade organisation Coceral last week put out its September estimates, forecasting a European Union (EU) wheat crop below 130 million tonnes of wheat, well below the averages of the past five years.
In particular, northern European states such as the UK, Germany, Denmark and Sweden will have markedly lower production this year compared with 2017.
Production is down in the US but there are good inventories.
Russia will be down 10m tonnes from last year (42m tonnes) and given the EU is also light on for wheat it will most likely be the US that fills the export void.
Tobin Gorey There has been significant media surrounding the hot English summer, which has been the warmest since record keeping began.
Only Spain experienced a significant year on year increase in production, due to issues with floods in 2017.
Commonwealth Bank of Australia commodity analyst Tobin Gorey said the drought meant Europe would not be a major player in wheat exports this year.
He said he expected US Department of Agriculture estimates predicting Russia would export 35 million tonnes of wheat this year would not come to pass.
“Russia will be down 10m tonnes from last year (42m tonnes) and given the EU is also light on for wheat it will most likely be the US that fills the export void.” The EU is importing far more wheat this season according to EU data, which showed imports landing in the Netherlands, Greece and Slovenia.