The grain market - France (2024)

1.2 The world cereals market

In ****-****, according to the FAO, an estimated *,*** million tonnes of cereals will be produced worldwide (***). The United States, the world's leading exporter, is losing market share every year.

Global cereal production has undergone a varied evolution in recent years. In ****-**, production stood at *,*** million tonnes, then rose to *,*** million tonnes in ****-**. After a few years of increases alternating with decreases, production has been growing in recent years. In ****-**, production rose again to *,*** million tonnes, then continued to grow in ****-** to *,*** million tonnes. Finally, for the year ****-**, world cereal production is estimated at *,*** million tonnes.

Cereal production World, ****-****, million tonnes Source: ****

The graph below shows that, while China, the United States and India are among the world's leading grain producers, they are very small players in international trade on this market.

World, ****, in millions of tons Source: ****

In the ****-**** period, global cereal production reached significant levels, with different quantities depending on the type of cereal. Maize was the most produced, at ****.* million tonnes, followed by wheat at ***.* million tonnes and rice at ***.* million tonnes. Production of other cereals was lower.

World production by cereal type World, ****, in million metric tons Source: ****

The European ...

1.3 The French cereals market

Agricultural acreage

In France, * thousand hectares will be under cereal cultivation in ****, i.e. around **% of France's arable land, a figure that has risen in recent years. As shown in the graph below, the majority of cereal acreage is used to grow soft wheat. This makes it France's leading agricultural market.

Distribution of arable land in France France, ****, in Source: ****

Market size

In ****, general agricultural production in value terms fell by *.*%, in a global context of falling grain and raw material prices after two years of strong increases. The cereals market in France is estimated at **.* billion euros in ****. [***] If we consider the entire cereal industry, from production to primary processing, sales amount to more than ** billion euros, with production and collection making up the bulk. It all depends on the cereal under consideration, but for some, such as malt and starch, revenues come largely from strong exports. In ****, cereal production rose by *.*% in volume terms, thanks to milder temperatures compared to the exceptionally high levels of the previous year.temperatures in the summer of ****, despite a slight reduction in cultivated area (***) due to a reduction in sown area.

****/**** cereal volume, price and value trends France, ****/****, in Source : INSEE On ...

1.4 France, a major cereal exporter

Almost half of French production is destined for export (***). The remainder of cereal production is intended to meet French demand. **% is marketed within the country, while the remaining **% is used by farmers for animal feed in particular. Breakdown of French cereal production France, ****, in Source : Passion Céréales Cereals are used for different purposes depending on the type of cereal. In the case of soft wheat and barley, most of the production is exported, while this is not the case for corn.

Use of cereals in France France, ****, in millions of tons Source: ****

In ****-****, ** million tonnes of cereals (***) were exported, generating a value of over ** billion euros, making France the world's *th largest exporter of cereals. Processed cereal products accounted for almost **% of these exports, i.e. over * million tonnes, and brought in almost * billion euros.

In terms of cereal export destinations, the European Union ranks first with **.* million tonnes. The Maghreb is also a popular export destination due to its proximity to French soil, with *.* million tonnes of soft wheat exported to the country in ****-****. China is also a privileged customer, as France exports *.* Mt of barley and *.* Mt of soft wheat.

While exports to the European ...

1.5 The impact of Covid-19 on the cereals market

The coronavirus pandemic in **** had no overall impact on the global cereals market in terms of production. In fact, the graph below shows that cereal production and use actually increased in ****. The FAO estimates formulated on February *, **** projected cereal production and utilization at **** Mt and **** Mt respectively, i.e. lower than the observed figures.

The "positive" impact of the coronavirus crisis on the world cereals market World, ****, in Source: ****

In detail, however, cereal markets have been differently affected by the crisis.

Impact of the crisis on the wheat market

Many markets have suffered from the coronavirus crisis since ****, particularly the milling industry, which is heavily dependent on wheat. The drop in activity is estimated at between -**% and -**%. According to these estimates, the annual use of soft wheat by millers in France would have fallen to *.** Mt from the *.** Mt initially forecast. [***]

The graph below clearly shows the drop in activity during the first wave of the coronavirus from March **** onwards.

Impact of Covid-** on bakery/pastry sales (***) France, ****, index base *** in **** Source: ****

However, while bakeries, pastry shops and the food service sector have suffered greatly from the crisis, industrial outlets for wheat production have been boosted. This is the ...

2.1 Cereals in the human diet

Cereals for human consumption take several forms, with a total of * million tonnes of cereals used, mainly in milling (***). The graph below details the main sectors that use cereals for their production:

Use of cereals for human consumption France, ****/****, in millions of tons Source: ****

As can be seen, bread-making represents a very important outlet for cereal production. As the graph below shows, the bakery/pastry market has been on the rise since ****, with the exception of ****, when the industry experienced a slight decline due to the pandemic and the two confinements that took place during that year.

Sales trend for bakeries/pastry shops by year (***) France, ****-****, sales index base *** in **** Source: ****

With **% of French people eating bread at least once a week, bakers seem to have a bright future ahead of them. For **% of consumers, independent artisan bakeries are still the preferred place to buy bread, yet more and more supermarkets are offering lower-cost bakery services. [***]

2.2 Cereals in animal feed

For the ****/**** campaign, around *.* million tonnes of cereals were used by the animal feed industry, making it the main consumer of cereal grains. This sector also absorbs the majority of co-products from cereal processing (***), thus contributing to the sector's zero waste objective.

Part of the cereal grain produced is consumed directly on the farm to feed animals. In addition, *.* million hectares of forage and silage maize (***) were grown in **** to feed ruminant livestock. Cereal straws are also used to supplement fodder.

As the graph below shows, wheat is the main cereal used for animal feed, accounting for **% of total animal use.

Breakdown of cereals used for animal feed France, ****-****, in Source: ****

Grain is mainly used to feed poultry, followed by pigs and cattle. Demand for grain is therefore strongly linked to demand for French meat. Grain consumption by type of animal France, ****, in millions of tons Source: ****

France has traditionally been a meat-consuming country, but consumption is in slight decline. All meat categories are affected by the decline in household consumption, coupled with rising prices. In the graph below, we can see a decline in the quantity of butcher's meat consumed by the French between **** and ****, to the benefit of ...

2.3 Cereals in bioethanol production

Cereals and bioethanol are closely linked. Cereals are the main raw materials used in bioethanol production. Cereals are generally used to produce bioethanol from their starch and sugar, which are natural, non-polluting products. Converting these products into bioethanol is a complex process that can be carried out using a variety of methods.

According to the Food and Agriculture Organization of the United Nations, the use of cereals to produce bioethanol is on the increase. In Europe, bioethanol production from cereals increased by more than **% between **** and ****. What's more, cereals account for around **% of bioethanol production worldwide. Cereals are therefore an essential component of bioethanol production. Their use has been decisive for the growth of this sector. The production of bioethanol from cereals is on the increase, enabling producers to reduce their greenhouse gas emissions and contribute to the fight against climate change.

As far as France's position in the European and global markets is concerned, the country will be the European Union's leading bioethanol producer, with **% of production in ****, amounting to **.* million hectolitres.

The following chart shows the annual growth in sales of superethanol-E**(***), which has risen significantly in recent years, increasing by **% between **** and ****, but by *.*% between **** and ****:

Sales of ...

3.1 The cereal value chain in France

Source: ****

3.2 Trends in cereal production in France

The annual trend in cereal production is not stable, and has fluctuated over the last decade. Between **** and ****, cereal production decreased by **.*% in value, **.*% in price, and increased by *.*% in volume.

Annual change in French cereal production by value France, ****-****, in Source: ****

The trend in soft wheat production in France shows considerable variability, with notable peaks in ****/**** (***).

Maize, for its part, shows an overall downward trend, particularly noticeable in ****/**** (***), with some intermediate fluctuations. Overall, while soft wheat and barley show irregular but relatively resilient production cycles, maize seems more sensitive to prolonged declines, potentially indicating greater vulnerability to weather conditions or agricultural policies.

Soft wheat production trends in France France, ****-****, in millions of tons Source : France Agrimer Barley production trend in France France, ****-****, in millions of tons Source : France Agrimer Maize production trend in France France, ****-****, in millions of tons Source: ****

3.3 Geographical weighting of French regions in the country's employment and cereal production

In terms of added value for the region, the Hauts de France region has the highest added value from cereal growing, at *.* billion euros, followed by Auvergne-Rhône-Alpes and Normandie, at *.* billion euros.

Employment in the French cereals sector

In ****-**, the French cereals industry will employ ***,*** people and generate sales of ** billion euros, with half of production exported. Some ***,*** farmers deliver their harvests, mainly to cooperatives[***]. Cereal processing employs ***,*** people in three main sectors:

Milling, semolina milling, baking and biscuit-making (***) Animal feed (***) Malting and brewing (***)

At regional level, the regions with the most cereal farms do not appear to be the most productive: although the Grand Est and Aquitaine are at the top of the rankings in both tables, regions such as Occitanie and Bretagne have a high number of farms, in spite of their high yields. of farms, despite a much lower yield than the first two regions mentioned, a symptom of often smaller farming units.

The figures shown above as "jobs in the industry" include not only the work of cereal farmers, but also that of processors, bakers and others.

3.4 Grain distribution in France

Global cereal distribution is dominated by the "Big Four", also known as the "ABCDs". These companies are :

A: Archer Daniels Midland (***), an American multinational estimated at $** billion B: Bunge, also American, with sales of $** billion C: Cargill, also American, with sales estimated at $*** billion D: Dreyfus, a Franco-Swiss group with sales of $** billion. [***]

The main strength of these four companies lies in their storage and transport capacity, a decisive variable in a market where the end product is so little processed and resale margins are so low.

New Asian players are entering this market, but are still a long way from the ABCD figures, as are Walmart and Carrefour, who have clearly understood the benefits of controlling the entire agricultural production chain[***].

Grain trading, a lucrative market at the expense of French purchasing power

The four dominant companies in the global grain trade, ABCD, have made exceptional profits since **** thanks to soaring prices. Despite a drop in prices after the peaks reached in May ****, prices remain historically high.

These companies control **-**% of the world grain trade, and have taken advantage of the food crisis to boost their profits to all-time highs. Cargill posted a net profit of $*.** billion in ****/** (***).

ABCDs ...

4.1 Typology of cereals produced in France

in France, more than half the cereals produced are soft wheat. This is followed by barley (***). Breakdown of cereal production in France France, ****, in Source: ****

4.2 Growing organic cereals

Organic farming is a production method designed to preserve the soil, natural resources and the environment in general.

Here are some examples of organic farming practices:

Crop rotation, Use of natural organic matter (***) and green manure, Respect for the seasons and the natural cycle of plants, Use of varieties adapted to local conditions (***). Contribute to the development of seasonal products. [***]

Labeling organic products is an essential element for producers, as it is the main source of consumer confidence. Only products containing at least **% organic ingredients are entitled to the AB and European logos. This is indicated alongside the name and accreditation number of the certification body[***]

The number of farms committed to organic farming increased by *% in ****, reaching **,*** farms, despite a slight drop in organic acreage (***). These farms represent **% of all farms and **% of agricultural employment, generating over ***,*** jobs.

In ****, *.** million hectares were farmed organically, representing **.*% of the French utilized agricultural area (***). The value of organic purchases remained stable compared to ****, with *.*% of household food consumption devoted to organic products [***].

Cereal crops are the first to convert in France, followed by viticulture. The years ****, **** and **** were particularly rich in conversions.[***]

In ****, cereals accounted for **% of organic field crop volumes collected. Wheat ...

4.3 Trends in cereal prices and the bread price index

This graph shows the evolution of soft wheat prices (***) from January **** to May ****. Several periods of rising and falling prices can be observed during this period. The beginning of **** was marked by a drop that could be due to factors such as favorable weather conditions, oversupply or a drop in demand due to the COVID-** pandemic that began during this period. Soft wheat prices then rose, thanks in particular to the resumption of demand after the initial containment caused by the pandemic, as well as production problems in certain regions of the world due to unfavorable weather conditions.

Between March and May ****, an exceptional rise was observed following Russia's invasion of Ukraine in February ****. The war in Ukraine had a profound impact on grain production and prices. Ukraine and Russia are both major grain producers, and the war has led to a drop in production in both countries. Production has been affected by problems such as damaged infrastructure and reduced agricultural investment in areas affected by the conflict. This led to a rise in grain prices, particularly for certain types of wheat and corn, whose prices are shown in the graphs below. Grain prices have risen significantly, with a negative impact ...

5.1 Regulations

Producer obligations

Before selling a product, the producer must ensure that sanitary obligations are met (***). He must also be able to provide all the information required for labelling and invoicing: otherwise, he is liable to his co-contractor and the authorities. [***]

Marketing cereals, oilseeds and protein crops

Cereals and oilseeds are subject to a special marketing regime at national level, and producers are not free to sell their produce. Any transfer of ownership of cereals and oilseeds can only take place through a collecting agency. [***]

Grain farmer/breeder contract

A contract is a meeting of the minds of the parties. It can be oral or written, except when the law requires it to be in writing (***). A written contract offers the advantage of clarity: in case of doubt, the parties can refer to an objective element. The transfer of an agricultural product can take place in a number of different ways: a distinction is made between one-off relationships and more long-term relationships spanning several years. [***]

New regulations

According to the French Ministry of Agriculture and Food, cereal exports outside the European Union will be banned from April **, ****. This ban applies to cereals and derived products, including seeds, grains and their by-products. Exports ...

5.2 European regulations for organic cereals

European regulations CE ***/**** and ***/**** govern all organic plant production, including cereals, and are common to all European Union countries.

Producers who comply with these regulations can claim the "organic agriculture" label and use the AB logo for their production.

Controls are carried out by state-approved certification bodies (***).

The active substances authorized for treatments or fertilization solutions are described in positive lists. Any product not included in these lists is prohibited in organic production. [***]

5.3 The importance of the CAP to European and French agriculture

Launched in ****, the EU's Common Agricultural Policy (***) is a partnership between the agricultural sector and society, and between Europe and its farmers. Its objectives are to

to support farmers and improve agricultural productivity, guaranteeing a stable supply of food at affordable prices; ensure a decent standard of living for farmers in the European Union; help combat climate change and manage natural resources sustainably; preserve rural areas and landscapes throughout the EU; preserve the rural economy by promoting employment in agriculture, the agri-food industry and associated sectors[***]

The CAP is a common policy for all EU countries. It is managed and financed at European level with resources from the EU budget[***]

Agriculture differs from most other activities for the following reasons:

despite the importance of food production, farmers' incomes are around **% lower than non-agricultural incomes; agriculture is more dependent on weather and climate conditions than many other sectors; there is an inevitable mismatch between consumer demand and farmers' ability to meet it: growing more wheat or producing more milk necessarily takes time. [***]

While ensuring profitability, farmers need to work in a sustainable and environmentally-friendly way to preserve soil and biodiversity[***]

Commercial uncertainties and the environmental impact of agriculture justify the important role ...

6.1 Segmentation

• +Simple.fr
• InVivo
• Axéréal
• Soufflet Groupe
• Vivescia
• Euralis
• Mars Petcare Monde
• Intercéréales
• Millbäker
• Agriavis (Axereal)