Romania – A Major Wheat Exporter Outside Europe
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Romania Ranks Fourth Among European Wheat Producers in MY 2021/2022
The European Union is a major Wheat producer globally, accounting for 138 Mmt in MY 2021/2022. France – the largest producer in Europe- increased production by 6.5 Mmt in MY 2021/2022 YoY. Germany and Poland – following France in the ranking – decreased their production by 713 kmt and 547 kmt YoY, respectively. Meanwhile, Romania increased production by 4.6 Mmt YoY to reach 11 Mmt and rank as the fourth producer in MY 2021/2022, while it ranked sixth in MY 2020/2021. Romania increased its production thanks to a 5 kha increase in harvested area YoY and good weather conditions in Europe in 2021. However, according to the USDA, Romania decreased Wheat production by 1.7 Mmt despite increasing harvested Area by 20 kha YoY in MY 2022/2023, mainly due to droughts.
Figure 1: Top 10 EU Wheat Producers (MY 2021/2022)
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Read also: Germany, a Major European Wheat Producer
Romania Overtakes France and Germany as the Major European Wheat Exporter
France and Germany were the major European Union Wheat exporters in MY 2019/2020, with 7.7 Mmt and 4.1 Mmt, respectively. However, in MY 2020/2021, they decreased their exports by 3.7 Mmt and 1.1 Mmt YoY, respectively. Meanwhile, Romania took the first position in the ranking with 4.7 Mmt of exports. In MY 2021/2022, Romania increased its exports by 3.9 Mmt to remain the leading Europe Wheat exporter. However, between Jul and Oct 2022, Romania’s Wheat exports only reached 2.9 Mmt, While France remains the largest exporter so far with 4.3 Mmt. Will Romania increase the export pace and remain the leading exporter in the MY 2022/2023?
Figure 2: France, Germany, Poland and Romania Wheat Production and Exports
in MY 2021/2022
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Where Is Romania’s Wheat Going Outside of the EU?
Romania’s Wheat main export pipeline outside Europe is North Africa. In MY 2021/2022, Egypt led Romania’s Wheat exports with 2.25 Mmt, followed by Jordan with 1.1 Mmt and Algeria with 0.91 Mmt. This trend remains the same between Jul and Oct 2022. However, Egypt’s decreased its total Wheat imports by 1.5 Mmt YoY between Jul and Oct 2022 due, notably, to high prices and large stocks. Among these, Wheat imports from Romania decreased by 729 kmt YoY. Meanwhile, Algeria increased Wheat imports by 2.0 Mmt YoY, thus largely compensating losses from the Egyptian market, and increasing imports from Romania by 511 kmt YoY. Will Algeria overtake Egypt as the main destination for Romanian Wheat in MY 2022/2023?
Figure 3: Romania’s Top Wheat Destinations MY 2021/2022 and Jul to Oct 2022
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Read also: Egypt Orders 1 Million Tons of French Wheat
The War in Ukraine Increased Romania’s Wheat FOB Prices
Romanian Wheat FOB prices were below USD 322 /mt between Jul 2021 and Jan 2022. Since the beginning of the war in Ukraine in February 2022, prices rose to USD 383 /mt in March, limiting Romania’s Wheat exports to 559 kmt in the same month. At the beginning of MY 2022/2023, and thanks to the grain corridor operating since July, Romania’s Wheat exports FOB prices decreased to USD 393 /mt, yet, they remained USD 144/mt higher YoY. In August, France’s Wheat FOB prices decreased and were USD 37 /mt cheaper than Romania’s, explaining why France’s Wheat exports are higher overall and compared to Romania in MY 2022/2023, so far. Overall, Romania’s exports between Jul-Oct are 1.4 Mmt lower YoY.
Figure 4: Romania’s Wheat Monthly Exports and Romania and France FOB Prices (Mar 2021 to Nov 2022)
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In a Nutshell
Romania is a major European Wheat producer with a high potential to export its production. In MY 2021/2022, Romania produced 11 Mmt of Wheat and ranked as the fourth producer in the EU. In the same MY, Romania’s exports reached 8.6 Mmt, to rank as the primary EU Wheat extra-trader.
However, since the war started in Ukraine in Feb 2022, Romania’s monthly exports have decreased, and FOB prices surged to peak at USD 430 /mt in Jun 2022. In Jul 2022, with Russia agreeing to the Ukraine grain corridor agreement, Romania’s FOB prices declined to reach USD 393 /mt in Jul and Aug. At The beginning of MY 2022/2023, Romania’s Wheat FOB prices were gradually decreasing. However, exports are not increasing YoY, due to lower yields caused by droughts, as well as the logistics difficulties in the Black Sea due to the ongoing war.
Finally, Romania is a major Wheat supplier for the North African market, particularly for Algeria and Egypt. If exports continue decreasing in the MY 2022/2023, these countries will have to diversify their Wheat import pipelines by either finding alternative export markets or reinforcing their other existing ones.
