Copa-Cogeca released final EU grain harvest estimates today, showing a slight 1.9% production rise, despite bad climatic conditions. But with the EU cereals market expected to remain tight this season, Copa-Cogeca warned against EU plans to further green the Common Agricultural Policy (CAP) and take land out of production.

The move came after Copa-Cogeca cereals working party assessed the situation. Ian Backhouse, Chairman of the Working Party, stressed  "This years total EU cereals production is set to reach record levels again, with production predicted to reach as much as 280 million tonnes. But in view of the poor climatic conditions, it was difficult to obtain reliable data on the quality of the harvest. The EU maize harvest is forecast to reach a record level, totaling 64 million tones which is up 14.7% on last years levels" (for details, see http://www.copa-cogeca.eu/img/user/file/CER-GOL-2011-09.pdf). Copa-Cogeca is also worried  about more duty free imports of cereals and bioethanol from Ukraine coming into the EU which do meet EU production requirements. Furthermore, it is unsure whether Ukraine could still be able to introduce grain export taxes within the framework of the current free trade negotiations between the EU and Ukraine which could increase volatility on the market.  

He continued "Some northern member states suffered wet conditions for harvesting this year. Despite this,  EU production is expected to match demand for the current marketing year 2011/2012. The market balance is set to be tight and stocks are likely to be lower at the end of next year. World grain demand is still high and world stocks are predicted to continue to decline. It is consequently crucial for EU consumers of  cereals, both for food and feed, to have stable prices and supply. It is not only grain producers who will be affected by the tight supply situation".

Mr Ehlers Chairman of the Cereal Advisory Group consequently insisted "In view of this, EU crop farmers see no reason to limit the EU grain production potential by introducing further measures to green the CAP. This would have a severe impact on the cereals market: namely to increase the volatility of raw material prices and bioethanol prices. This is the last thing that the EU needs at the moment".