Drought conditions in Spain could affect crop production in the country and lead to increased demand for grain imports at a time of growing concern about the Ukrainian grain corridor, AgriCensus wrote.

According to the European Union (EU)’s Monitoring Agricultural Resources April report (MARS), no meaningful rainfall had fallen in Spain’s main agricultural area since January.

Soil moisture was now critically low with negative impacts on crop growth and development, the MARS report said.

“The drought is already suffocating 60% of the Spanish countryside and has caused irreversible losses to more than 3.5M ha of non-irrigated cereal crops,” AgriCensus quoted the Spanish agricultural union COAG as saying in the 2 May report.

According to trade sources, lower production levels in Spain could lead to an increase in feed grain imports, including from Ukraine and also from Brazil, which is expecting a large corn harvest.

“Spain experienced a dramatic drought that sharply reduced grain crops, increasing the country’s grain shortfall,” the US Department of Agriculture (USDA)’s Grain and Feed Annual noted, adding that this, in turn, drove Ukrainian imports.

Ukrainian wheat exports to Spain increased by 627% from 158,681 tonnes in 2021 to 1.15M tonnes last year, according to Fastmarkets data.

Spain had also benefitted from the implementation of the Black Sea grain corridor (BSGI) facilitating agricultural exports from Ukraine during last year’s drought, the USDA said.

The second biggest beneficiary of the BSGI after China, official data showed Spain had imported 5.1M tonnes of products under the corridor since it opened last August, AgriCensus wrote.

Meanwhile, olive oil producers in Spain had been hit by the impact of extreme heat waves and drought conditions, particularly in the southern region of Andalusia, the world’s largest olive oil-producing region, Olive Oil Times wrote on 27 March.

According to Spain’s Ministry of Agriculture, Fisheries and Food, olive oil production in the country is not expected to reach 700,000 tonnes in the 2022/23 crop year.

The ministry’s latest report, published in February, revised previous estimates down to 680,000 tonnes, a third below initial estimates made in August, Olive Oil Times wrote.

Data from Spain’s Food Information and Control Agency (AICA) showed 652,080 tonnes of olive oil had been produced by the end of February, with the agency expecting Spain to produce less than 30,000 tonnes in the last two months of the harvest.

Along with production, olive oil sales in Spain also fell significantly in the first five months of the crop year, Olive Oil Times reported. Provisional data from AICA showed that sales totalled 484,600 tonnes from October 2022 to February 2023, a 25% drop compared to the same period the previous year