Large part of wheat harvest only suitable as animal feed

The wheat harvest in Germany is certainly not running smoothly. The crop has been ravaged by rain and drought, making the quality too bad for the baking industry. That is why an extra large amount of wheat is eligible for animal feed.

Researchers at Agravis, part of Raiffeissen, expect that approximately 40% of the German wheat harvest is only suitable for the animal feed industry. That is double compared to other years. Wheat quality is worse than last year and also worse than in 2015. German arable farmers have been ravaged this year by varying weather conditions. From a cold and dry spring, to high temperatures in June and a water ballet in July.

Another bummer      
The changeable weather has not done the crop any good. Due to the high temperatures in June, for example, the wheat grains are smaller. This results in a higher protein content.

An analyst from the German AMI also expects a lot of animal feed wheat to hit the market this year. According to the analyst, there was only just enough feed wheat available last year. This year there are surpluses that could possibly be exported to Southern Europe. Feed manufacturers, meanwhile, are already taking lower wheat prices into account.

Due to the disappointing harvest, high-quality wheat is scarce and therefore in demand. Arable farmers are therefore alluding to a higher wheat price and are probably waiting to sell. According to grain traders, a definitive judgment cannot yet be made, because only 5% of the wheat in northern Germany has been threshed.

August determines
The final balance can only be drawn up in a few weeks. The weather in August will determine whether German wheat exports fall by 15% this year in a worst-case scenario or can remain the same as last year in a best-case scenario. 

Click here for a market flash on the current wheat price on the Matif in Paris. 

Wouter Job

Wouter Baan is editor-in-chief of Boerenbusiness. He also focuses on dairy, pig and meat markets. He also follows (business) developments within agribusiness and interviews CEOs and policymakers.

w.baan@boerenbusiness. Nl

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