Russia’s military aggression against Ukraine has significantly disturbed global agricultural markets and has created more uncertainty regarding the future availability of grains and oilseeds, according to the latest short-term outlook report published by the European Commission on Tuesday 5 April.
The EU is largely self-sufficient in food, with a massive agri-food trade surplus, and the European single market should once again be expected to prove its ability to absorb shocks. However, there are concerns about high market prices and inflationary trends.
Arable crops. Proposed measures to increase the EU’s arable crops production will allow farmers to increase their sowing area for maize, sunflowers and protein crops. As a result, the 2022 EU harvest could be very good one for cereals and oilseeds, provided normal weather conditions prevail. EU cereal production is expected to reach 297.7 million tonnes for the 2022/2023 harvest (+1.5%). This could help to soften the impact the expected lack of grain exports from Ukraine may have on global markets.
Cereal exports are expected to increase by 14% in this marketing year (until the end of June). The increase could be more significant after the 2022 summer harvest, with net exports of EU cereals potentially increasing by almost 40% to 41.4 million tonnes from July 2022 to June 2023 (2022/2023 marketing year).
Oilseed prices have skyrocketed since the start of the Russian invasion of Ukraine, with rapeseed and sunflower prices reaching €1,000 per tonne. Oilseed production, however, is not a concern, being estimated to grow by 6.5% to 30.2 million tonnes this marketing year, and projected to increase to 32.2 million tonnes in the coming marketing year (including 11.2 million tonnes of sunflower seeds).
EU sugar production is expected to increase by 14% by 2021/22 to 16.6 million tonnes.
The report also shows that: - olive oil production could reach 2.3 million tonnes in 2021/22, (+10% over one year); - milk deliveries decreased by 0.3%, which has not happened since 2009; - beef production is expected to decrease in 2022 despite high prices (exports should increase slightly due to recently concluded trade agreements, but are constrained by limited domestic supply and trade frictions with the UK); - poultry production is expected to increase slightly in 2022.
Link to the report: https://aeur.eu/f/142 (Original version in French by Lionel Changeur)