Drought in Europe Drastically Cuts Corn Harvest
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Extreme heat and drought across the European Union have slashed corn harvest forecasts to 49.1 million tons, triggering a supply crisis in the feed and biofuel sectors.
Sharp Decline in EU Corn Harvest
Extreme heat and drought conditions across Europe are triggering a new supply bottleneck in the grain market. According to commodity data firm Expana, the European Union's corn production forecast for the 2026/27 season has been revised down by 4.6 million tons from last month to 49.1 million tons. The firm's analysis indicates that this production is 13.9% below last season and 19% below the 5-year average. Declining yields, particularly in France, Hungary, Germany, and Central Europe, are narrowing profit margins, with the outlook approaching the lows seen in the 2003/04 and 2007/08 periods.
France Nears Historic Lows
France, at the epicenter of the production crisis, is seeing its harvest expectations rapidly diminish. Data from the French Ministry of Agriculture suggests that 2026 corn production is projected to fall sharply by 35% year-on-year to 9 million tons. This figure marks the lowest harvest level recorded since 1980. The ministry noted that planted areas have shrunk by 21% and average yields are expected to be the weakest since 2003, at 7.03 tons per hectare; private sector analyst Argus Media estimates French production at 6.9 million tons.
Crisis in Feed and Ethanol Sectors
The shrinking supply volume is making raw material procurement difficult for the feed and biofuel industries. Harvest losses in France and Hungary are directly impacting feed producers in Belgium and the Netherlands, leading to significant shortages in non-GMO corn supply. Low water levels on the Danube River are disrupting transportation, while high natural gas prices are pressuring the margins of ethanol plants. According to Platts data, the price of T2 fuel ethanol reached €714.75 per cubic meter as of August 5, underscoring the rising cost landscape.