France’s wheat exports plummet amid Algeria rift, rising Russian competition

FRANCE – France’s wheat exports are facing a severe decline, exacerbated by diplomatic tensions with Algeria, diminished demand from Morocco, and increased competition from cheaper producers like Russia.

As the European Union’s top grain grower, France is grappling with one of its worst export seasons in decades.

The French farm office FranceAgriMer has maintained its forecast for soft wheat shipments outside the EU for the 2024/25 July-June season at 3.5 million metric tons, marking a two-thirds drop from the previous season.

This projection is the smallest export volume recorded this century. So far, only around 1 million tons have been shipped in the first half of the season, with industry insiders expressing pessimism about reaching the forecasted target.

“It will be a miracle if we even get to 3 million tons,” a trader remarked.

The situation is dire for French farmers, who resumed protests earlier this year over falling income and increasing foreign competition.

The impact on the broader French economy is also concerning; last year’s poor harvests, caused by incessant rain, shaved 0.2 percentage points off economic growth, according to national statistics.

Algeria, traditionally one of France’s largest wheat buyers, has significantly reduced its imports from the country. Diplomatic tensions have played a significant role, with Paris’s recognition of Morocco’s sovereignty over Western Sahara reportedly leading the Algerian grains agency OAIC to tacitly exclude French wheat from import tenders since October.

While the OAIC asserts that it treats all suppliers fairly, industry experts describe the situation as a “complete blackout.”

Morocco, another key market, has similarly scaled back its purchases of French wheat. Sales have more than halved as Moroccan buyers turn to Russia, which continues to expand its wheat trade despite Western sanctions over its invasion of Ukraine.

The head of Morocco’s grain traders’ association has indicated that France lacks the needed quantities to meet market demands, further complicating the trade landscape.

The competitive pressure from Russia and other Eastern European producers has intensified due to France’s smaller harvest and mixed crop quality, which have made accessing overseas markets more challenging.

France’s once-dominant position in North Africa is now in jeopardy, with its status as a major global wheat exporter under threat.

Accoring to analysts, Argentina may soon overtake France as the sixth-largest wheat exporter, widening the gap between France and leading producers such as Russia, Australia, Canada, and the United States.

Didier Verbeke, chairman of Senalia, emphasized the need for diversification.

“It could be a case of having more diverse export outlets, with less focus on Africa given Russia’s active presence,” Verbeke noted.

However, the road to recovery may be long and uncertain, as intra-EU trade fails to compensate for the losses, with cheaper Ukrainian wheat dominating markets like Spain.

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