Posted on April, 13, 2025 at 08:37 pm
European Union soft wheat is set to benefit from the escalating trade war between the United States and China, consultancy Strategie Grains said, as it raised its output estimates for all major EU cereals this year due to improved growing conditions.
Beijing imposed 84% tariffs on US imports on Wednesday to match US President Donald Trump’s earlier moves, making US grains less competitive on world markets.
The trade war further escalated when Trump announced a 125% tariff despite pausing reciprocal tariffs for most trading partners. The EU has been a regular wheat supplier to China in recent years but demand has faded this season due to good local supplies.
Meanwhile EU retaliatory tariffs on US products, including maize (corn) from April 15, were expected to bring US corn imports to a halt and eat into EU maize stocks next season, Strategie Grains said. Further down the road, demand for EU grains could benefit from planned tariffs on US soybeans, it also said. These are set to enter force on December 1.
In terms of supply and demand, Strategie Grains increased its forecast for EU soft wheat production in 2025/26, citing improved growing conditions.
The latest projection places EU soft wheat output at 128.1 million metric tons, up from 127.5 million tons forecast last month and now 13% above last season’s rain-hit harvest.
“Although not spectacular, growing conditions for winter cereals improved in the EU27 thanks to the arrival of rains in the southeast EU countries, and a break in the rains across northwest Europe,” Strategie Grains said.
However, “cereals crops are not yet out of the woods and harvest time is still a long way off,” it added, citing excessive rainfall in Spain.
Source: Business Recorder