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Wheat area may fall in France, rise in UK, Germany

London, September 24, 2009

More wheat is set to be drilled this year in Britain and Germany although low prices may lead to a drop in area in France, analysts said on Thursday.

Rapeseed plantings look set to rise in Britain and France although are likely to be little changed in Germany, they added.

French farmers will not begin sowing wheat until next month, but observers are anticipating a drop in area.

'There aren't any signs suggesting a rise,' said Adrien Bebin, analyst with grains consultancy Offre & Demande Agricole.

In addition to the need to rotate crops to preserve soil quality, growers could be drawn away from wheat by low prices and new EU subsidy rules encouraging a wider range of crops, analysts said.

Milling wheat futures in Paris are currently trading around 122.00 euros a tonne on the benchmark front month, down about 29 per cent from levels traded a year ago.

Analysts noted under a mid-term reform of the bloc's farm policy due to come into effect in 2010, the EU will shift some aid towards growers who have a mix of several crops and also offer subsidies for protein crops such as peas.

'We could see a direct impact from the EU aid per hectare,' said Gautier Le Molgat, analyst with Agritel, another French  grains consultancy. 'We might see a revival of peas as a crop.'    

However, the wheat area was not expected to fall by much as growers would be keener to move away from barley, for which prices have fallen even lower, and because wheat has a strong hold as France's dominant grain, analysts noted.

'It won't change much. It's straightforward to grow and it's a crop that works pretty much everywhere,' Le Molgat said.

Wheat area in Britain should be higher, however, buoyed by more favourable planting conditions this autumn. Last year many farmers were forced to switch to spring crops, reducing wheat area in the UK by 13.5 per cent.

Plantings started towards the end of the first week of September and gathered pace this week.

'I would certainly expect it (wheat area) to increase,' said analyst Susan Twining of crop consultants ADAS.
   
Twining said low barley prices may also encourage more farmers to plant wheat.

A rise in wheat plantings is also expected in Germany, partly at the expense of rye which is losing area because of low prices and difficult market conditions.

Seed traders in Germany estimated wheat area could climb about five per cent to 3.40 million hectares.

In import-dependent Spain, farmers do not usually begin planting winter wheat and barley until October, because milder weather means they can leave field work later than in northern Europe.

Antonio Caton, a grain technician with the Cooperatives Association, said ground soil had a good consistency after recent heavy rains so preparation work is under way.

'It's too early to make estimates, but we expect more set-aside, because farmers are fed up with low prices,' Caton said.

Spanish farmers sowed 1.8 million hectares to wheat in the 2008/09, which was down from a peak of 2.0 million in the previous campaign due to collapsing prices.

France could see an increase in rapeseed sowings for the 2010 harvest as growers are encouraged by record yields in this summer's crop.

Rapeseed sowing was well advanced, with the majority of crop sown in the big growing regions, and early indications pointed to an increase in overall area.

'It looks like the rapeseed area could rise,' Adrien Bebin said. 'Generally when they (farmers) get good yields, they like to repeat the same crop.'    

Rapeseed plantings are now almost complete in Britain.

'In most regions there has been a very good autumn drilling period and there have been very few d


Tags: agriculture | wheat | farming | barley | Crops | Grains | rapeseed | rye |

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