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By Gus Trompiz
PARIS, March 24 (Reuters) – Morocco has emerged as the biggest export outlet for European Union wheat in 2022/23 as sales to other destinations have been curbed by revived Black Sea competition after war disruption eased.
In a year marked by Russia’s invasion of fellow grain exporter Ukraine, the EU sold heavily at the start of the July-June export campaign as importers sought alternatives to Black Sea grain.
With increased import needs after a drought-hit harvest last year, Morocco became a bigger-than-usual outlet for EU wheat and has overtaken Algeria as the bloc’s top destination.
Morocco plans to bring in another 1.5 million tonnes of soft wheat over March-May, and importers are expected to stick to EU supplies given logistical and financial risks for Ukraine and Russian grain, Yann Lebeau of French grain industry group Intercereales said.
Steady demand from Morocco, as well as large sales to Algeria, China and Egypt, have helped France, the EU’s biggest wheat producer, sell most of a non-EU export surplus estimated at just over 10 million tonnes. FRWHEAT/PORTS
“The French market fared better by selling a lot early in the season,” a trader said. “Other EU countries like Romania are trying to offload wheat with negative physical premiums.”
Black Sea competition has come back to the fore since the middle of the season, with Ukrainian volumes supported by a wartime Black Sea corridor and Russia finding outlets for its record 2022 harvest.
Waning export prospects pushed European and U.S. wheat futures to their lowest since 2021 this week. GRA/EU
“Europe and the U.S. have been increasingly incapable of selling their old crop,” Rabobank analyst Michael Magdovitz said.
After projecting record EU soft wheat exports of 40 million tonnes in 2022/23 at the start of Russia’s invasion of Ukraine, the European Commission progressively cut its forecast to 32 million, with other forecasters seeing them closer to 30 million.
However, traders don’t rule out a late-season wave of EU exports, with doubts over Black Sea supplies persisting as Russia only commits to the corridor deal until mid-May and examines ways to boost its farmgate prices.
Top EU wheat export destinationshttps://tmsnrt.rs/40jIHNl
(Reporting by Gus Trompiz and Forrest Crellin in Paris and Michael Hogan in Hamburg; Editing by Andrea Ricci)
((gus.trompiz@thomsonreuters.com; +33 1 49 49 52 18; Reuters Messaging: gus.trompiz.thomsonreuters.com@reuters.net))
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