Italy, the world's biggest pasta consumer, can't abandon the North American wheat used to make spaghetti and macaroni after smaller plantings and foul weather curbed output in the European Union.
Exports of durum wheat by the U.S. and Canada are booming, foiling efforts by Italy to protect its farmers by adopting country-of-origin labeling rules in 2017, effectively damping imports. EU production of the wheat variety for the season that began in July fell 10% to 7.78 million tons, European Commission data show, triggering demand for North American supplies.
Italian importers took advantage of U.S. and Canadian durum of "excellent quality" at "historically cheap values," said Niccolo d'Andria, vice president of the Rome-based grains group Associazione Nazionale Cerealisti, or Anacerl. A second round of imports may loom in April, he said.
Exports of Canadian durum to Italy in the two months ended Sept. 30 almost tripled to 156,500 tons from a year earlier, according to the Canadian Grain Commission. Shipments from the U.S. in the nine months ended September more than doubled to 210,000 tons, the most since 2015, U.S. Department of Agriculture data show.
Output in Canada and the U.S. also declined as excessive rain hampered harvests. Farmers also reduced acreage for durum, which can be challenging to grow.
Prices for durum stayed relatively low during the growing season, which contributed to Italy's demand, said Erica Olson, market development and research manager at the North Dakota Wheat Commission. "Some buyers were buying early and buying fast based on production and quality issues. The big question is if it will continue."
Canada "has become the supplier of last resort," said Cam Dahl, president of Cereals Canada. "Nothing has changed in Italy. The country of origin labeling provisions are still in place."