Spain, with a structural deficit in grains, is Europe’s biggest grain importer, with purchases mainly driven by a large livestock sector. A Member State of the European Union, the country is unique in the E.U. for large-scale adoption of genetically modified crops, with Bt maize grown on a relatively large scale.
The International Grains Council (IGC) now forecasts Spain’s total 2018-19 grains production at 21.7 million tonnes, up from 15.8 million in 2017-18. Wheat production is forecast at 7.2 million tonnes, up from 4.9 million the year before. Maize production is expected to rise to 4.4 million tonnes from 3.7 million in 2017-18. Barley output is seen unchanged at 1.6 million tonnes. The IGC expects Spain to produce 300,000 tonnes of rye, up from 100,000 tonnes a year earlier. Durum production is seen at an unchanged 1.1 million tonnes.
The IGC noted that regular rainfall sustained high productivity in Spain, in contrast with France, which had lost yield because of excessive rainfall. On durum yields, it noted that “wet conditions are said to have adversely affected some of the outturn in Spain.” The cool and wet spring was favorable for barley.
The European grain trade body COCERAL forecasts Spain’s 2018 rapeseed production at 191,000 tonnes, up from 142,000 the year before. It puts Spain’s sunflower production at 840,000 tonnes in 2018, down from 888,000 in 2017, while soybean production is put at an unchanged 6,000 tonnes.
“The large majority of the sunflower in Spain is grown in non-irrigated land,” the attaché explained in July. “While spring rains improved sub-soil humidity required for this crop’s growth, the poor margins reported by the crushing industry and the high volumes of sunflower oil that are being imported prevented the sunflower area from growing.”
Rapeseed area is small, but the attaché noted that “it has registered a continuous increase over the past years, mainly driven by demand for the biodiesel industry in neighboring countries (i.e. Portugal, France).”
Spain is the E.U.’s biggest grains importer. An attaché report published in July explained why.
“Spain has highly variable grain yields, which, combined with its comparatively large livestock sector, results in a significant structural shortfall of feed grains and protein meals,” the attaché report said. “Regardless the size of the domestic grain crop, Spain needs to import at least 13 million tonnes of grains per year to meet the country’s total average demand of just above 35 million tonnes of grains.”
The report explained that the compound feed industry is the main customer of grains and oilseed meals in Spain. Feed consumption of grain amounts to an average 25 million tonnes a year.
“Nearly half of Spain’s industrial feed production is produced under vertical integration model, one fourth goes to the free market, and the remaining fourth is managed by agricultural cooperatives,” the report said. “The Spanish feed sector’s vertical structure and integration, in particular in the poultry and swine sectors, from grain purchases to meat export sales, results in high production and market efficiencies.”
The attaché points out that raw materials are not largely available, which differentiates Spain from other key players in the E.U. and global meatmarket.
“The Spanish feed-supply value-chain participants are experts in managing the scarce feed ingredients available,” the report said. “Buyers may turn to domestic or imported grain, depending on price and location factors.”
Inland feed compounders are more likely to use domestic grains, while those based in ports can switch more easily.
“For instance, Spain jumped to low-priced U.S. sorghum imports when it was hit by Chinese anti-dumping tariffs in mid-April, and switched back to corn-based feed formula when the window of opportunity vanished,” the report said. “Trade sources estimate that total U.S. sorghum imports by Spain during that period of time could amount to 250,000 tonnes.
“Swine, followed by cattle and poultry, are Spain’s main livestock sectors. Official statistical information for 2017 shows that the Spanish swine sector accounts for nearly 45% of the industrial compound feed production, followed by cattle with over one-third of production. Poultry feed production accounts for nearly 20% of the total feed produced in the country.”
Spain is one of only two European Union countries that grow genetically modified crops, according to an attaché report published in November 2017. The other is Portugal.
“Spain is the largest grower of Bt corn in the E.U.-28 and has traditionally defended a science-based approach to agricultural biotechnology decisions,” the report said. “In Spain, GE corn plantings have coexisted with conventional corn since 1998.”
Genetically modified maize grown in Spain constitutes 95% of all GM crops grown in the E.U.
“Spanish farmers can decide to grow biotech or conventional crops based on market conditions,” the report said. “Practically all feed marketed is default labeled as ‘contains GE products.’ On the food side, domestic manufacturers continue to reformulate to avoid the ‘Contains GMOs’ claim. Meanwhile, an increasing number of imported, consumer-oriented products are sold with the ‘Produced from GE crops’ wording.”
The report explains that Spain’s structural deficit in grains and protein crops makes imports of GM crops essential for its livestock sector.
“GE products imported to Spain consist mainly of corn and corn processing byproducts and soybeans and soybean products,” the report said.
“The large majority of Spain’s farmers associations are in favor of planting GE crops,” the report noted. “The use of agricultural technologies such as biotechnology or irrigation systems to improve competitiveness and obtain consistent output levels are positively perceived and defended by a large majority of the farming sector.”
The attaché noted a lack of recent research into public attitudes to biotechnology.
“Eurobarometer 2010 concluded that Spain’s index of optimism for agricultural biotechnology/genetic engineering was among the highest within the EU (74%) and so is Spain’s support for GE food (35% of respondents agreed or totally agreed that GE food should be encouraged),” the attaché report said.
Genetically modified feed has not become a consumer issue, according to the report.
“There is not a strong reaction from Spanish retailers or meat consumers to meat fed with GE feed,” the attaché report said.
There are 110 flour mills in Spain, eight of which have a capacity over 2,000 tonnes a year, according to the European Flour Millers.
In its “The European Flour Milling Industry” publication, the sector body said there are no figures for capacity utilization, but that mills work between 240 and 350 days a year.
Around 3.9 million tonnes of wheat and rye are used in flour production. The grain for milling is sourced around 50% from Spain itself, 40% from the rest of the E.U. (France, Germany and the U.K.) and 10% from countries outside, notably the United States, Canada and Russia.
Annual consumption of flour is 59 kilograms per person. Annual consumption of bread is 47 kilograms per person.
According to the USDA attaché, there are three grain-based ethanol facilities in Spain “whose total grain consumption may amount to nearly 1 million tonnes.”
The report noted that the largest grain-based, inland ethanol plant stopped production between April 2016 and August 2017 because of tight margins, explaining that input and output must be transported to and from port locations, but that since August 2017 all plants had been running at nearly full capacity.
“In MY2018-19, corn is anticipated to remain the preferred and most likely sole feedstock for the Spanish grain ethanol industry,” the report said.