EU Says Heat Wave Will Hit Cereals Crop
Date: 29-Sep-03
Country: UK
Author: Martin Hayes
Cereals production should reach 186 million tonnes in 2003, more than 23 million tonnes lower than last year, EU farm union COPA-COGECA said.
Wheat production was severely affected and would reach 83 million tonnes, against an output of 93 million last year. Maize production would fall by some 21 percent to 32.5 million tonnes, while output of rye would drop by a third to 3.3 million tonnes.
"The countries most affected in terms of volume among the main European cereal producers are Germany, Italy and France," it said in a statement.
COPA-COGECA's total cereal forecast was also a substantial drop on its July estimate of 197.3 million tonnes, released just as temperatures began to soar across the 15-nation bloc.
Despite the crop losses caused by the drought, the EU would still be able to meet its internal grain requirements by dipping into ample stocks and using imports that were already committed.
Also last week, EU grain trade lobby Coceral similarly cut its 2003 cereals forecast and pegged the overall crop at 182.81 million tonnes, down 25.3 million from its 2002 figure - and lower than the COPA-COGECA figure.
Coceral cut its soft wheat estimate to 82.87 million tonnes from 93.96 million in 2002 and said maize production would reach 30.52 million tonnes against 38.68 million previously.
BRAZIL TO ALLOW GMO SOYBEANS
Brazil decided on Thursday to let its producers grow genetically-modified (GMO) soybeans, although this will not cause any problems for EU importers, as there are many other outlets of non-transgenic varieties.
Brazil's Vice President Jose Alencar signed a temporary decree on Thursday allowing producers to plant GMO soybeans legally for the next three months.
The decree said soybeans planted through the current planting season, or until the end of this year, could be transgenic. It limited the sale of the seeds until the end of 2004.
Brazil has been one of the world's last major agricultural exporters to ban GM crops, although soy farmers have ignored the ban and smuggled illegal transgenic soy seeds from neighboring Argentina for years.
"As it stands, we can already source non-contaminated soybeans from the U.S. and Canada where GMO crops are widely grown, so this really doesn't affect us too much," a Netherlands-based importer and producer of non-GM soybean flour said.
"The restrictions Brazil wants to impose effectively limit their growth this season anyway and it looks like plantings beyond that are still in doubt - it doesn't mean they're making long-term plans," he added.
GOLD SLIPS AFTER SWISS ANNOUNCE SALES
Gold bullion prices fell sharply, with Switzerland doing the market no favors by announcing that it would sell 284 tonnes of gold by the end of September 2004 and an additional 130 tonnes in the year after that.
Analysts said Switzerland wants to head the queue of prospective gold sellers as central banks prepare to weigh renewal of a five-year pact limiting bullion sales from their vaults.
The current Central Bank Gold Sales Agreement (CBGA), prompted by concerns central banks were selling off so much gold they were creating huge uncertainty in the market, limits disposals by major European central banks to a combined 2,000 tonnes by September 2004.
"I think what the Swiss National Bank are doing is saying 'Don't forget we're at the top of the queue when we renegotiate, we're already selling, we beg first place in any new agreement'," said Societe Generale economist Stephen Briggs.
The Swiss National Bank (SNB) said it had sold 886 tonnes of gold since May 2000 under the CBGA.
The spot price washed back to key support at $380.00 per ounce last week afternoon, as the euro slipped to session lows against the dollar following a stronger-than-expected U.S. gross domestic product report.
The move temporarily halted the strong uptrend. Bullion drove up to a high on Thursday of $393.30 - a level unvisited since mid-May 1996 - as speculators piled
