The US Agriculture Department's attache in Vienna released the following report, dated March 31, on the outlook for Hungary's grain crops.
After the very low grain harvest in 2003, Hungary's grain trade is small. The upcoming EU accession will not result in major changes in the growing pattern. Normal weather points to an average crop in 2004. Contracting animal production will result in higher wheat and corn exports in 2004/2005. Hungary strictly follows EU biotechnology regulations, and it is expected that biotech varieties will not be introduced in the next few years.
Fall planted wheat area is 1,140 thousand hectare (plus 10,000 hectare durum wheat). The green crop wintered well under partial snow cover and had adequate precipitation. Yield expectations are for a solid average.
Farms seeded 193,000 ha of winter barley. Spring barley planting is still ahead but area is usually at about 160,000 ha.
The two other winter grains (seeded in the autumn) are rye and triticale. The rye area of 49,000 ha is in line with the long-term average, while triticale area, 160,000 ha, registers an eight percent increase over 2003.
The Government of Hungary (GOH) and industry forecasts a slight increase in corn area to 1.2 million hectare.
Fertiliser use in 2003 was at 460,000 MT active ingredients, 8.7 percent above the 2002 level. Analysts expect higher fertiliser use and more rational input use from 2004 as a result of increased production support for grain cultivation.
Prices and leasing fees for agricultural land were low in Hungary until 2003. Due to increasing EU and GOH support, leasing fees and land prices have started to increase.
Direct payment on arable land was HUF 7,000/ha (USD 34/ha) in 2003. This support may reach HUF 38,000/ha (USD 183) in 2004 [although a part of it may effectively be paid out only in 2005; see Policy section for additional information].
Land owners/users registered only 3.5-3.6 million hectares of arable land for parcel identification by mid-March 2004. Registration is the precondition for direct payments.
The original deadline for farms was December 20, 2003, but the GOH prolonged registration by one month more. Until now only eighty percent of Hungary's 4.477 million hectares of eligible arable land acreage has been registered.
The smaller registered area may reduce direct payments to farms per one hectare.
Grain use by the domestic food industry is not expected to change in 2004. Dry milling uses 1.7 - 1.8 million MT of wheat and 170 - 200 thousand MT of corn annually.
The above figures were somewhat lower in CY 2003 - 1,45 million MT and 122 thousand MT -respectively. Wet milling (high fructose corn syrup production) consumes about 500,000 MT of corn annually.
Swine stock was 4.7 million at the end of 2003, the lowest in ten years. Opening stocks of adult poultry in 2004 were 55.4 million, 2.3 million lower than a year ago.
The increase of chicken, turkey and geese could not counterbalance the drop in the number of layers and ducks.
Production in the main feed grain-consuming sectors, poultry and swine, will decline further in 2004 and 2005 (see Gain Reports HU4001 Poultry and Products and HU4006 Livestock and Products reports). Consequently domestic coarse grain consumption for feed will be lower.
In the case of an average crop, exportable surpluses of wheat and corn may go up to million tons.
Preliminary compound feed production data for CY 2003 shows an 8 percent drop from the previous year. Feed for swine was 2.1 million MT, poultry 1.6 million MT, cattle 0.6 Million MT, and other mixed feed 0.2 million MT.