German Use of Corn for Biogas Seen Hurting Grain Output

Germany’s use of corn to make biogas is reducing grain production as the crop competes for acreage, hurting the country’s self-sufficiency in cereals, farm organization Deutscher Raiffeisenverband e.V. said.

The cultivation of corn for biogas is expected to cut grain supply by about 4 million metric tons this year, the Berlin- based group wrote in an e-mailed statement today.

German farmers are forecast to harvest 41.5 million tons of grain in the period, not enough to cover average demand of about 41.8 million tons, according to the DRV. Germany is the European Union’s second-largest wheat grower and exporter, behind France.

“We’re experiencing a politically-driven tightening of the grain offer, which has to be compensated by increased imports of grain substitutes such as soybeans,” Henning Ehlers, the DRV’s director, was cited as saying in the statement.

The reduced supply of domestically grown grain is causing rising feed costs and reduced competitiveness for the German dairy and livestock industry, according to Ehlers.

To contact the reporter on this story: Rudy Ruitenberg in Paris at rruitenberg@bloomberg.net.

To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net