Up to 75% of France's wheat surplus could be exported by end-Dec

21 Nov 2022 | Yana Sukharska

The pace of French wheat exports have been supercharged by conflict in the Black Sea, as end users looked for alternative wheat supplies amid the Russian invasion of Ukraine.  

France started its exports in the new marketing year at an unusually strong pace, and by November has already exported 63% of its potential surplus for the 2022/23, trade sources have told Agricensus.

The country sold a large share of its crop at the beginning of the season on a forward basis, as supply concerns forced wheat importers to shore up stocks and European producers capitalised.

As of November 21, the total export volume amounted to 6.3 million mt, according to analysis of European Commission export data and data from ship line-ups.

That is 75% more than both last year's performance and the average of the last three years.

Comparing that to the estimate for non-EU exports from the French government farm agency Franceagrimer, the figure amounts to 63% of the 10 million tonnes it is forecasting.

However, adding to those existing large sales this season, importers in China have also secured at least half a million mt of French wheat for December shipment, while big volumes were also booked by Morocco, trade sources have said. 

The sales, which were believed to have taken place late last week, included eight confirmed and possibly up to ten panamax cargoes booked in total with 60,000-65,000 tons each of 11% protein wheat - all believed to be French origin - sold at $375/mt, traders said.

But traders cast doubt on the ability of France to source such volumes - given the tight supply in the market. 

"We believe [other traders] could have done more, but that’s committing suicide as the market is short cash," a source said regarding reports of heavy Chinese buying of French wheat and a shortage of physical grains.

This means that any traders may be physically unable to buy such a volume in the next half month, particularly given the falling market triggered by the extension of the Ukrainian grain corridor.

While the total volumes bought were not yet clear, multiple sources spoken to by Agricensus believed that by the end of December, up to 7.5 million mt - or 70-75% of France's wheat surplus - could have already been sold, putting it significantly ahead of the same stage last year.

According to European Commission data, by the end of December last year some 4.6 million mt of wheat had been exported to countries outside the EU bloc.

That represented 53% of the country's export potential, according to French government farm agency Franceagrimer at the time.