Wednesday, May 31, 2023

Heat and drought cut the grain crop

A few weeks after the start of grain-harvesting operations in Andalusia, harvesting is already a fact in hundreds of thousands of hectares in that autonomous community, Castilla-La Mancha and Extremadura as well as in Castilla y León or the southernmost lands. Arid regions of Aragon or Catalonia due to high temperatures and lack of water. In the rest, especially in the highlands of Castilla y León and the Ebro or Catalonia, there is some hope that if there is a change towards a more favorable climate that allows a campaign dominated by high production costs to be partially saved . Especially in fertilizers and energy, which will increase the red number of farms and decline in economic activity in rural areas.

The harvest is going to be low or non-existent, but, unlike last year, prices do not appear to be rising and compensating for lower yields as abundant production is expected in some EU countries and other regions of the world. ; That is, there is enough grain. Added to this situation is the fact that in insurance against drought, despite the existence of an average subsidy on the cost of policies of 40%, which reaches 65% in some cases, the level of coverage is only a little over 40% on one is above. Total area 5.3 million hectares. Some statistics that lead to a debate on this type of policy look at why the level of insurance against an accident that is repeated with increasing frequency does not increase among farmers.
Given the new campaign, previous estimates, on which the Cooperativa Agro-Alimentarias works, put the harvest in the range of 12 million tons. This means that, in order to meet the supply needs of the internal market, especially for feeding livestock herds and for human consumption, Spain has to increase its grain imports by more than 35%, from less than 19 million to almost to be increased to 26 million tonnes. , which obviously increases foreign dependence.

For practical purposes, as long as there are no new convulsions in foreign markets for reasons unrelated to production, farmers would favor the survival of a good harvest in the rest of the EU and traditional supply countries in third countries. Which can slow down the price rise. For farmers, on the other hand, a 30% increase in production costs and currently stagnant grain prices will add up to a lower harvest.
Last season, with a low harvest of only 18.3 million tonnes, Spain had to import around 19 million tonnes to meet needs, which have practically stabilized at around 36 million, of which 26 are for animal feed. are compatible. There is still no official data on crop forecasts for the current season.
Considering the effects of drought in the southern half of the peninsula and other northern areas, where the heat and lack of water have practically destroyed crops, from agri-food cooperatives, winter cereals—wheat, barley, Forecast for oats or rye – not to exceed 12 million tonnes. In terms of irrigation, questions remain in corn production due to a reduction in area from 360,000 to about 300,000 hectares and a lack of water for irrigation in many areas, especially from the Ebro to the south.


Overall, in the first estimate, the crop would be estimated at around 2.5 million tonnes, compared to 3.8 million tonnes for the previous season; In wheat it will increase from 6.1 million tonnes in the previous campaign to only 4 million tonnes; The harvest for barley will be around 4.5 million tonnes, compared to last year’s 6.7 million tonnes and the previous record nine million tonnes. For the rest of the winter grain crops, complete crops of oats, rye, triticale, etc. It does not reach one million tons, compared to 1.8 million in the previous year. Overall, the harvest is less than the minimum that may reach only between 11 and 12 million tonnes, similar to 11.3 million in 1995 and 2005 and 27 million light years in 2020 and an average between 23 and 24 million.

This debacle in the grain harvest exacerbates problems in the agricultural sector as a whole, as it leads to a 30% increase in production costs to more than 35,000 million euros and finalizes agricultural accounts. According to official figures, seed expenditure this season increased from 1,208 to 1,244 million, energy from 2,385 to 3,566 million, fertilizer from 2,217 to 3,243 million and feed from 14,200 to 19,000. Insurance against drought that could help mitigate the effects of lack of rain was signed up on only 20% of the 18 million hectares of dryland that had the potential to do so, as the area agreed to requirements, conditions and coverage. was not. Considered in this line.

Looking at the national situation in cereals, good prospects for overseas crops are being handled. In the European Union, an increase of 7% to 284 million tonnes is projected. Similarly, eastern countries and other regions such as Brazil have favorable expectations, so there is no supply constraint and theoretically at contained prices. Spanish wheat has traditionally been imported from France, Ukraine, Bulgaria or Romania; Corn from France, Brazil and Romania and barley mainly from the United Kingdom and France.
Taking into account grain needs for the next campaign, the demand for cattle feed could be reduced by 5% if the expected demands on welfare were imposed, as well as the economic difficulties to prevent investment in herds. Including adjusting and not expanding fields. and because of the lack of permits to improve facilities. In principle, despite better prices at the source, future new demands on animal welfare, due to the increase in area and fixed costs for the production of the same, will mean adjustments in major herds such as poultry and especially pigs. In, large applicant for corn or barley.

Nation World News Desk
Nation World News Desk
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