PARIS (Reuters) - French analyst Strategie Grains on Thursday sharply cut its forecast for this year's grains crops in the European Union due to renewed dry conditions in the Western part of the bloc in May and despite recent rainfall.
Soft wheat saw the largest reduction, at 6 million tonnes, with the estimate of the 2011 crop lowered to 125.6 million tonnes, now 1 percent below last year's 126.6 million tonnes.
"The springtime drought continued throughout May in West Europe, reaching critical levels in many countries," Strategie Grains wrote in its monthly report.
"Rains arrived at the beginning of June but in most places this was too late to fundamentally alter harvest outlooks, since yield potentials were already irrevocably impacted in France, Britain and Germany," it added.
However, a cut of almost 7 million tonnes to the wheat crop outlook in the west EU was partially offset by a 1 million tonne increase in the forecast for southeast countries and a 400,000 tonne upward revision for Mediterranean countries, it said.
Strategie Grains has now cut its outlook for the total EU soft wheat crop by nearly 10 million tonnes in the past two months. The analyst had previously anticipated a rise of as much as 7 percent in soft wheat output.
The new reduction to its crop estimate led Strategie Grains to slash by 4 million tonnes its forecast for EU soft wheat exports next season to 12.9 million tonnes, down 6 million tonnes on 2010/2011.
"The drastic reduction in projected EU export availability seems now unavoidable given the sharp reduction of EU wheat supply," the analyst said.
EU wheat stocks would remain relatively tight, with little prospect for growth, which could support prices in the medium term even if they may weaken when Black Sea countries return to export markets this summer after being absent this season due to drought-hit 2010 crops, Strategie Grains said.
The analyst also reduced by 2 million tonnes its forecast for EU barley output this year, to 52.2 million tonnes, now down 2 percent on the 2010 harvest.
Strategie Grains kept its maize crop forecast nearly unchanged, down 100,000 tonnes to 59.0 million, still up 8 percent on 2010 output.
In total, it put the European Union's 2011 cereals harvest at 275.7 million tonnes, down 9 million tonnes from last month but still 0.6 percent above 2010.
(Reporting by Sybille de La Hamaide; editing by James Jukwey)