2023-10-09 15:27:40
There is an increase in oilseeds by 11% and dairy products by 1%
Hot and dry weather combined with excess rainfall in several parts of Europe in the summer of 2023 continued to test the resilience of farmers. Yields of various field and specialty crops were affected, harvests were delayed, pests and diseases developed, and the quality of some products also suffered. At the same time, there are signs of a positive market outlook for the EU agricultural sector. Input costs such as energy, fertilizers and feed continued to decline. EU agricultural and food exports have regained some competitiveness, confirming the EU’s position as the world’s largest exporter. Published today by the European Commission, the autumn 2023 edition of the short-term forecast report on EU agricultural markets presents the latest trends and outlook for agricultural markets.
Polish crops
Cereal production in the EU for 2023/24 is expected to be 4.3% below the 5-year average at 268.5 million tonnes, due to unfavorable spring and summer weather conditions which particularly affected maize production and barley. The use of cereals for feed may remain stable, while the use of cereals for biofuel production may continue to increase (12% over 2022/23). The EU continues to be a net exporter of cereals, especially wheat. Exports to the Middle East and Sub-Saharan Africa increased particularly in the previous months.
EU oilseed production is developing particularly well (11% above the 5-year average), driven by a recovery in sunflower production as well as higher soybean production.
Although the total ban on the use of neonicotinoids poses some challenges for sugar beet growers, planted areas, beet yields and sugar content are expected to increase compared to the decline recorded last year. EU sugar production for 2023/24 is forecast at 15.6 million, close to the 5-year average.
Specialized crops
Olive oil production will remain low and is not expected to fully recover in 2023/24. Prices will remain high, leading to lower EU exports and consumption. In some regions, prices are nearly 3 times higher than the 5-year average. Stable imports may help EU availability to some extent, which will nevertheless remain low.
EU wine production in 2023/24 is expected to decline by around 6%, mainly due to declines in Italian and Spanish production. Consumer demand, especially for red wine, continues to decline. Consumers have lower purchasing power and are turning to other beverages such as beer.
Under the influence of unfavorable weather, the production of apples and oranges will have a similar downward trend, about 2% less than last year. Also, more fruit is likely to be used for processing due to lower quality and higher storage costs.
Milk and milk products
EU milk supplies remain fairly stable and are expected to increase by 0.3% in 2023. EU raw milk prices have been declining since the beginning of the year. Although energy, fertilizer and feed costs are slowly starting to fall, they remain high, resulting in low margins for EU dairy farmers.
Cheese production is expected to be 1% higher in 2023 than last year. The decline in food inflation in the EU is likely to have a positive impact on domestic consumption as well (+0.2%). The production of fresh dairy products (cream and drinking milk) increased more than expected. As EU exports are unlikely to expand due to declining demand in China, additional quantities are likely to be consumed domestically, showing greater resilience to rising prices compared to other animal products.
Meat products
Europeans will continue to eat less meat. Overall, meat consumption per capita in the EU is expected to decrease by 1.5% in 2023 due to price inflation and lower market supply. The decline is stronger in the consumption of beef (-3.5%) and pork (-5.2%), while the consumption of poultry will increase by 4.3%.
Beef and poultry prices remain high due to reduced supply. Supported by recovered production, poultry remains one of the cheapest sources of animal protein for consumers.
Sheepmeat production in the EU is expected to suffer from a structurally deteriorating sheep flock, lower grass availability, especially in Mediterranean countries, higher feed costs and outbreaks of sheeppox in some countries.
Updated balances for the 2023/24 marketing year are included in the latest short-term forecast report and are also available on the Agri-Food Data Portal.
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