Summary
Since 2020, the global cereal market has been resilient despite the COVID-19 pandemic, with both cereal production and use rising, indicating an overall stability in the market. France, as a significant player in the market, has witnessed fluctuations with certain sub-sectors like milling facing a drop in activity ranging from 30% to 50% and hence declining wheat usage by French millers. Conversely, industrial outlets like pasta distribution have seen an increase (7.6%), and wheat exports from France strengthened as the country's competitiveness in the market increased.
In terms of organic cereal production, France was in a position to self-supply its organic wheat demands, showcasing growth in this segment. However, the pandemic notably impacted barley used for malting as global trade slowed down by around 5% due to reduced tourism and events, leading to increased use of malting barley for animal feed.
Corn, on the other hand, sustained a stable demand within the EU, boosted by its incorporation into animal feed which offset the reduced ethanol demand affecting American producers.
Overall, the French and global cereal markets demonstrated adaptability, with slight shifts in demand between sub-sectors and a continuing trend towards sustainability and organic production. France continues to be a major exporter, with a significant portion of its production heading overseas, maintaining a strong position in a market dominated by a few global players such as the ABCD group.
Trends and Dynamics in the French Cereal Market
France is a prominent player in the cereal market, both domestically and globally. With a strong tradition of cereal production, France dominates in terms of output and trade within the European Union and also stands out on the world stage. A distinct trend has been observed in cereal production and utilization in the French market, aligning with a global context similarly marked by significant movements and challenges. The cereal market in France is large-scale, covering more than half of the arable land and making up a substantial share of the country's agricultural output. Multiple grains are grown with a key focus on soft wheat, barley, and maize. The market has proven resilient, exhibiting overall stability, despite facing fluctuation during certain years.
Within France, regions such as the Grand Est and Hauts-de-France lead in production, showcasing the geographical spread and significance of the sector. On a global scale, France is amongst the top five cereal exporters, contributing significantly to the staggering total of between 350 and 400 million tons traded annually. While countries like China and India are the leading grain producers, they have a limited presence in global trade markets, contrary to France, which maintains a healthy export flow, particularly towards Belgium, Algeria, and other European neighbors.
The demand for cereals within France showcases nuanced trends; nearly half of the production caters to international markets, while domestic consumption indicates preference for cereals in various forms. Bakeries and the biscuit industry are evident growth areas, feeding the nation's love for bread and confections. Meanwhile, the livestock industry also heavily relies on cereals, with wheat taking a significant share in animal feed consumption.
Cereals are segmented into multiple uses and forms ranging from human consumption to animal feed, and their role in French culture and economics cannot be overstated. The industry not only supports the agriculture and food-processing sectors but also contributes to the socio-cultural fabric through the affinity for bakery products and the importance of cereals in the traditional French diet.
Moreover, the push towards organic production has seen an uptick with the organic cereals sector experiencing considerable growth, mirroring the global trend towards sustainable and environmentally-conscientious farming practices. As per the latest data, wheat constitutes the largest share of organic crop volumes in France, and the country has reached a point where its organic wheat production can satisfy the national demand. However, not all has been smooth sailing, as the Covid-19 pandemic.
Key Market Players in the Global Cereal Value Chain
The cereal market is a vast and complex industry with dynamic players involved in the production, processing, and distribution of grains across the globe. Among the myriad companies that operate within this sector, certain enterprises stand out both for their size and their strategic influence over global supply chains. These central actors can be segmented into different categories based on the roles they play within the market.
- Agricultural Cooperatives: Distributing Cereals Agricultural cooperatives are vital in the collection and distribution of cereals, providing an array of services to their members – the farmers. These services include marketing of cereals, provision of agricultural inputs, and sometimes even processing facilities. European heavyweight Axereal exemplifies this category with its extensive network that ensures grains from the farm are effectively marketed and distributed.
- Animal Feed Producers: The seamless conversion of cereals into animal feed is a critical aspect of the value chain given the significant portion of grains consumed in this manner. Companies like Nuwen Animal Nutrition and Euralis stand out as major entities, supplying essential nutrition to the livestock industry and helping in the efficient conversion of cereals into animal protein for human consumption.
- Feed Mills: Converting raw cereals into usable feed forms is the speciality of feed mills, and such operations are not necessarily part of larger conglomerates. The Bread Observatory, although not a conventional feed mill, nonetheless represents the analytical and research services that support the milling industry and its outputs.
- Maltings: For beer enthusiasts, the maltings industry is of particular interest. Acting as the bridge between cereal farmers and breweries, maltings companies process barley into malt, a key ingredient in beer production. France's position as a leader in malting barley production owes much to the efforts of companies like Vivescia, which also contributes significantly to international beer production through exports.
- The ABCD Quartet: Perhaps the most influential entities in the global cereal market comprise the "Big Four," often referred to as the "ABCD" of the grain world – Archer Daniels Midland (ADM), Bunge, Cargill, and Dreyfus. These companies control a vast majority of the cereals passing through the global market, and their dominance is attributable to their capabilities in storage, transportation, and the economies of scale they enjoy. Their strategic positions enable them to influence prices, supply chains, and trade flows significantly.
- New Market Entrants - Beyond these longstanding players, new entrants continue to emerge, particularly from Asia.
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- Last update : 06/07/2023
Summary and extracts
1 Market overview
1.1 Definition and scope of the study
Cereals include all plants cultivated for their grains and used for human and animal consumption but also for industrial purposes. The main cereals in the world are wheat, corn, rice, barley and oats.
The main cereal producers in the world are China, the United States, the European Union, India, Brazil and Russia. The European Union produces 310 million tonnes of cereals for 56 million hectares under cultivation and enjoys a positive trade balance. World cereal production is dominated by maize, ahead of wheat and rice, which together account for 90% of the world's cereal production. Other grains produced include barley and sorghum. In 2018, more than 400 million tons of cereals were traded for nearly $100 billion, with France being the 5 ème world exporter of cereals and one of the leading European exporters.
Cereal growing in France occupies more than half of the arable land with almost 10 million hectares of occupied area This has made French agriculture a major sector, with the northwest and southwest regions being the most dynamic in terms of production. About ten species of cereals are grown in France, including soft wheat, grain corn, barley and durum wheat. There are tens of thousands of agricultural productions in France which act on the whole value chain: from collection, to the first transformation (milling, malting, etc.) to the second transformation (bakery, biscuit factory, etc.)
List of charts
- Production de céréales par type
- Principaux producteurs de céréales dans le monde (incluant le riz)
- Production de céréales
- Type de céréales à l'exportation
- Répartition de la production française de céréales
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