Argus Lowers 2026 French Wheat Production Forecast to 30.8 Million Tonnes

Argus has lowered its estimate for France’s 2026 wheat production, excluding durum wheat, to 30.8 million tonnes, reflecting a week-long survey of major French cooperatives and grain market participants conducted from July 13 to 17.

The revised estimate reflects deterioration in crop conditions since the June Argus crop tour, when Argus released its previous forecast of 32.29 million tonnes. Argus’ latest production estimate is based on a national average yield of 6.67 t/ha, down 6.5% from the 10-year Olympic average, which excludes the two highest and two lowest yields in the period.

Hot and dry weather in recent months has limited yield potential and accelerated winter grain development, causing harvest to begin earlier than in previous years. Except for western Brittany and northwestern coastal areas, harvesting has largely been completed across France.

Argus’ production estimate is 1.2 million tonnes lower than the forecast released by the French agriculture ministry Agreste on July 15. The largest difference between the two comes from wheat yield estimates in Hauts-de-France, France’s largest wheat-producing region, which is expected to account for nearly 20% of national output in the 2026-27 July-June wheat marketing year.

Argus estimates the region’s average yield at 8.12 t/ha, while Agreste forecasts 8.55 t/ha. Participants in the Argus harvest survey reported yields in Hauts-de-France at around 7% below the region’s 10-year Olympic average. Hot and dry conditions in May and June reduced crop potential during the key flowering and grain-filling stages.

The survey also confirmed that the sharpest yield declines occurred in areas around the Atlantic port of La Pallice. This zone includes Vendée, Deux-Sèvres, Vienne, Charente, and Charente-Maritime, where average yields are estimated to be 15% below the 10-year Olympic average. Excessive winter rainfall followed by an unusually dry spring created unfavorable crop conditions in the region.

Despite lower yields, survey participants reported no significant quality issues. Instead, they reported higher-than-usual protein content in the region.

Smaller Crop Reduces Export Potential

France’s 2026 wheat crop is expected to be one of the smallest in the past two decades, but it remains above the 25.17 million tonnes harvested in 2024, when both planted area and yields fell sharply, and above the 29.21 million tonnes recorded in 2020, a season marked by very low planted area.

This year, Agreste estimates the harvested area at 4.62 million hectares, up 2.7% year on year, partly offsetting the decline in yields.

The downward revision to French output inevitably raises questions over export availability. Based on Agreste’s crop estimate, national agricultural agency FranceAgriMer released its first full 2026-27 supply and demand forecast on July 16, projecting French wheat exports, excluding durum, to non-EU countries at 7 million tonnes, down 400,000 tonnes from 2025-26. This would be the lowest level since the 2024-25 and 2016-17 marketing years.

Argus’ lower production estimate implies a further reduction in export supply. The outlook is further complicated by expectations of a lower French corn crop this year, which could increase demand for wheat and barley substitutes in animal feed and further tighten the balance sheet.

Ukraine POC ports open but grain trade curtailed

Ukraine’s grain terminals are operating at reduced capacity following recent strikes on merchant vessels and port infrastructure, while the market faces higher security risks and logistics bottlenecks.

Vessels chartered before the escalation are still arriving and loading at the ports of Pivdennyi, Odesa, and Chornomorsk, known as the POC ports. But market participants said booking new vessels has become extremely difficult. Many shipowners are either demanding high freight rates to cover war-risk premiums or refusing to enter the region altogether.

This has created a logistics “trap”: port silos are close to full capacity, and additional grain intake depends on vessels clearing storage space.

Market responses to volatility are divided. Some traders have adopted a wait-and-see approach, suspending spot operations until the security situation becomes clearer. Others continue buying grain in the domestic market for shipment to ports, but because they need to offset surging insurance costs, they are applying strict volume limits and bidding at steep discounts.

Exporters are also increasingly assessing the feasibility of alternative logistics to maintain continuity. Companies with Danube River assets are evaluating these routes to bypass deep-water restrictions, while procurement prices are being adjusted lower to reflect the higher costs and risks that alternative channels may bring.

Although the POC ports remain operational, the combination of saturated storage and thin vessel lineups is expected to keep spot market liquidity low in the near term.