The USDA estimates EU-25 wheat production for 2006/07 at 119.4 million tons, down 6.8 million or 5 percent from last month and down 3.4 million or 3 percent from last year. Area is estimated at 22.7 million hectares, down 0.2 million or 1 percent from last month, but up 0.2 million or 1 percent from last year.

Heat and dryness during grain-fill stage has significantly reduced wheat production prospects in Germany and, to a lesser extent, France. The two countries account for roughly 50 percent of EU wheat production. Although excessive heat prevailed in both countries throughout July, the wheat crop in France was already approaching maturity and damage was less severe than in Germany.

Wheat production in France for 2006/07 is estimated at 36.5 million tons, down 6 percent from last month and 1 percent from last year. By the first week of August, wheat harvesting was nearly complete.

In Germany, wheat production is forecast to drop 14 percent from last month and 11 percent from last year, to 21.0 million tons. Wheat harvesting is in full swing in Germany, with producers reporting low test weights and a higher-than-normal percentage of shriveled kernels due to the hot conditions during grain fill.

Source: USDA's Foreign Agricultural Service