SASKATOON — The European Commission is forecasting rising cereal and oilseed values in the European Union between now and 2035.
Cereal prices are expected to increase by 1.7 per cent per year, influenced by higher fertilizer prices, according to the commission’s EU Agricultural Outlook 2025-2035 report.
Oilseed prices will grow more slowly between now and 2035 than they did between 2015 and 2025. Soybean prices will bump up the most, increasing by 1.6 per cent per year.
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The report did not offer a projection for pulse prices.
Derek Squair, president of Exceed Grain Marketing, agreed that the cereal outlook will be heavily influenced by the rising cost of production.
However, he thinks the oilseed price forecast is conservative, especially from a Canadian perspective.
“I think there’s more growth potential than that in oilseeds,” said Squair.
“We have probably got a little bit more upside than that.”
Why it Matters: The European Union can be an important outlet for some Canadian crops.
The EU is projected to remain self-sufficient in cereal production.
Wheat yields have the potential to increase, while corn and barley yields are projected to remain stable.
Advancements in cereal crop breeding will be offset by the negative effects of increasingly frequent extreme weather events, increased acres devoted to organic farming and the rising cost and reduced availability of crop inputs.
Nitrogen fertilizer costs could be affected by the EU’s Carbon Border Adjustment Mechanism and new tariffs on Russia and Belarus.
EU cereal production is forecast at 267.7 million tonnes in 2035, 0.6 per cent above the 2023-2025 average.
Oat production is the real standout, forecast at 7.5 per cent above 2023-25 levels due to strong demand from the food sector.
Soft wheat imports are expected to decline by 3.3 per cent per year due to greater domestic production in the EU, while corn imports could increase slightly due to greater global availability of the crop.
Squair said the forecast for slumping wheat imports makes sense because of shifting consumption patterns, such as the rise in gluten-free diets.
Oilseed yields are expected to remain stable, while pulse yields could increase by three per cent between now and 2035.
The negative yield effects of unpredictable weather events, the expansion of low-yielding areas and poor availability of crop inputs could be offset by technology adoption, biopesticides and sustainable practices.
Production of oilseeds and pulses is forecast at 36.1 million tonnes by 2035, a 2.5 percent increase from the 2023 to 2025 average, supported by favourable EU policies for pulses and soybeans and increasing demand for plant-based proteins.
Pulse production will grow by an average of 0.8 per cent per year between now and 2035, the biggest increase of any oilseed or protein crop.
Rapeseed production is forecast to remain stable at about 18.4 million tonnes, capped by a declining demand from the biofuel sector and the reduced availability of crop protection products.
Biofuel demand for rapeseed in the EU is expected to fall by 4.5 per cent compared to the 2023-25 period as the EU throttles back on crop-based biofuels.
Squair thinks there is far more optimism for biofuel feedstock demand in North America, where there is plenty of room to grow.
Food use of pulses in the EU is projected to increase by 13 per cent over that same timeframe, although feed will remain the main source of demand for pulses.
Annual imports of pulses are projected to “decline considerably,” falling 2.1 per cent per year between now and 2035 as the EU becomes more self-sufficient in pulse production.
Squair said pulses are one area where there is probably more growth potential in the EU, while Canada’s production is limited by rotations.
Total EU oilseed imports are projected to fall by 5.9 per cent compared to the 2023-25 period mainly because rapeseed oil crushing is expected to drop 5.1 per cent during that period due to reduced biofuel demand.
EU demand for animal feed is projected to drop by 2.5 per cent from the 2023-25 period driven by the reduced production of pork, beef and veal and improved feed efficiency, especially for cattle and pigs.
The biggest reduction will be in feed use of wheat, barley and other cereals. Oilseed meal demand from the feed sector is projected to decrease at a lower rate than cereals.
