DUBLIN, March 16, 2016 /PRNewswire/ --
The U.K. is experiencing its highest wheat sales in four years thanks to a declining pound, itself a result of concerns over Britain's vote on whether to leave the European Union. The Brexit's adverse effect on the pound has made British products more competitive for overseas buyers, triggering a growth in exports. A market report forecast wheat production in the United Kingdom to grow at a CAGR of 36.7% by 2018/19 due to increasing demand from export destinations. This forecast could be lower if Britain decides to stay in the EU, as the pound will quickly recover its value following such a decision.
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British wheat exports reached almost 310,000 metric tons in January, the highest monthly amount since December 2011. The majority of January's exports went to EU countries, with Spain importing more than 175,000 tons. Two successive bumper harvests have left Britain with an excess of wheat, and the growth in exports is predicted to continue until Britain's relationship with the European Union is decided. Both sides of the Brexit debate claim long-term market benefits for grain farmers but it will take some time after the vote to determine the actual effect on the market.
The decision is expected to influence a range of related markets. The European market for seed treatment in wheat is projected to reach a value of USD 229.8 million by 2020, as noted in a recent report. This value could be higher if demand for U.K. wheat continues to grow, as British farmers will require additional resources such as seed treatment to ensure healthy and abundant crops.
The global bakery market is set to grow at a CAGR of 7.04% by 2019, as forecast in an industry report. This growth could be higher if European food producers continue to take advantage of the declining pound and heavily import British wheat.
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SOURCE Research and Markets