The European Union has, temporarily, suspended import duties on feed wheat and barley, lifting the chance of the first imports from Australia in more than a decade.
Officials from EU countries approved proposals to drop until June the E12 a tonne duty on feed wheat and the E16-a-tonne levy on feed barley.
"I hope this proposal will reduce tensions on the European cereals market," Dacian Ciolos, the EU agriculture commissioner Dacian Ciolos, said.
The move follows "strong calls" from feed groups and the livestock industry, notably in Spain, a major grain importer, and examination of the implications of tarriff concessions, a commission spokesman told Agrimoney.com.
"We feel that prices are high enough that this can be done without damaging the global market," teh spokesman said.
Australian imports?
The European Commission last month rejected the plans, arguing that they would have little effect on prices in the region.
"It remains to be seen if today's move will actually bring in many imports," a commission source told Agrimoney.com, noting the costs of bringing feed grain shipments to Europe could still leave them uncompetitive, even without the tariff.
Australia ?which, thanks to harvest rains, has seen an unusually large proportion of its milling wheat and malting barley crops downgraded to feed ?has been touted as a likely source.
And, indeed, in Asia, Australian feed wheat is displacing more-expensive corn, with talk that China may buy up to 1m tonnes.
Tender indications
However, in milling grain at least, results released on Wednesday of an Egyptian tender highlighted that European wheat is still competitive as far as the other end of the Mediterranean.
Egypt, the world's top wheat importer, awarded 60,000 tonnes of a 180,000-tonne order to French wheat, priced at $360.90 a tonne. Including shipping, the price was $382.12 a tonne.
While Glencore offered Australian wheat at $349.75 a tonne, shipping costs to Egypt are close to $40 a tonne, results from a tender earlier in the month show.
The balance of Wednesday's Egyptian order went to US grain, priced at $345.37 a tonne, with shipping costs of $36.44 a tonne on top.
Agritel said that Australian feed grains "could probably find their way to the south of Europe.
"But given the high transportation costs, the low quality of these feeding cereals, and the fact that China captures most of the Australian availabilities, the impact of these imports on the European market should be limited," the Paris-based consultancy added.
