Concerns rise over Germany’s 2023 wheat protein content

German market sources have raised concerns over the country’s upcoming wheat crop amid heavy rains, which could potentially bring higher yields but lower nitrogen levels resulting in lower protein content, trade sources told Agricensus Thursday.

“Protein in Germany is a big risk indeed, as we already had a way higher share of 11.5% wheat this season versus previous years,” one trader told Agricensus, versus a typical protein content of around 12.5%.

According to trade sources, the approximate ratio of Germany’s wheat crop is typically comprised of up to 80% of production rated at 12.5% wheat and the remaining 20% the lower 11.5% protein wheat.

However, the 2022/23 season delivered around 40% and 60% respectively, resulting in Germany losing destination market share to other origins.

“Buyers like Saudi Arabia shipped from the Baltics/Poland instead [of Germany] this year,” the trader added.

With the new crop approaching, all eyes are on how the protein content will line up, with crop uncertainty keeping traders out of the market and away from active trading for July-September dates across Europe.

That in itself is quite unusual for this time of the year, with sources saying German wheat is currently too expensively priced to attract any demand.

Latest selling indications for a handysize vessel of German 11.5% wheat were heard at either parity to or a slight €1/mt premium to the December Euronext wheat contract, equating to around $258-259/mt FOB Hamburg/Rostock.

That makes the country uncompetitive in the destination market at the moment, as the latest tender from Algeria’s OAIC illustrates, with trades closing at $275-276.50/mt CFR for July shipment.

In the meantime, a panamax of 12.5% wheat was priced at a €7.50-8/mt premium or $266-267/mt FOB.

In its latest report, Germany’s Deutschen Raiffeisenverband (DRV) has cut the country’s wheat production forecast to 22.15 million mt, down 1.6% from last year’s 22.52 million mt, based on lower planted areas of 2.89 million ha.