Supplying U.S. demand | European Union oat exports expected to climb to nine-year high
PARIS (Reuters) — European Union oat exports are on course to hit a nine-year high, reflecting strong U.S. demand as logistical snags curb Canadian supplies.
The supply tensions in North America have put a spotlight on what is a niche market compared to wheat or corn, with oats futures in Chicago hitting an all-time high before pulling back sharply in volatile trading this month.
The EU recently awarded 10,000 tonnes of export licences for oats, taking the volume to 209,000 tonnes so far this season, the official data showed.
It was the biggest volume since 230,000 tonnes in 2009-10, which the EU should surpass by the end of 2013-14 season to mark its biggest haul since 358,000 tonnes in 2004-05.
Record grain harvests followed by a severe winter in Canada, which is the United States’ main supplier, have overwhelmed the rail network and slowed oat shipments.
As well, U.S. demand for oats, which is usually driven by human breakfast food as well as horse feed, has been reinforced by their use in pig diets to counter the effects of porcine epidemic diarrhea virus.
EU oat exports are dominated by Finland and Sweden, which have claimed 84,500 and 80,500 tonnes, respectively, of EU export licences so far this season.
The licences do not show destinations, but July-December shipments showed the U.S. accounted for more than half of oat exports, according to International Grains Council data.
The record for EU oat exports dates back to 2002-03, when the bloc shifted nearly a million tonnes in a season marked by a drought in Canada.
However, this season’s volume could set a high since the ending of EU export subsidies, which included a provision for Nordic oat exports to the U.S.
EU oat production rose to 8.4 million tonnes in 2013 from 7.8 million in each of the two previous years, according to estimates from the International Grains Council.
Other major EU producers are Poland, Britain and Germany.