by PressThe price of durum wheat on the world market continues to increase
The price of durum wheat: the reasons for the increase in the cost of grain
The price of durum wheat continues to rise on the world market, which, according to experts, reduces the likelihood of overproduction of some varieties of crops. According to analysts’ estimates, in the current season, the volume of production of this type of grain by the largest exporters will be at the level of 16 million tons. The list of countries that supply the world market with large quantities of durum wheat includes the European Union, Mexico, Canada, and the United States. Last marketing year, the figure was 13 million tons.
According to analysts, the grain yield in the U.S. will be higher than in the EU countries. In this case, experts praise the condition and quality of land in France, in contrast to North Africa, where the dry season continues. The relevant ministry of Morocco predicts a 78% reduction in production compared to previous figures. To compensate for the loss, the country will have to import about 1.5 million tons of durum wheat. By comparison, last season Morocco bought only 0.2 million tons of this product.
Mercantile Consulting believes that the main exporter of grain for the country will be Canada, which can sell 890 thousand tons. Such a deal could be one of the largest for Morocco. In turn, Canada increased the area under crops by 0.2 million tons, which amounted to 5.7 million acres.
The price of durum wheat rose to record levels at the beginning of winter and then began to decline gradually. However, the situation is unstable, and a rise in price is possible again. The fact is that in previous years, a number of producers significantly reduced volumes due to drought and other adverse weather conditions. For example, Canada experienced a severe drought, and it will take local farmers about 2 years to get back to the previous levels. The country is gradually increasing production and exports. Local traders are expected to sell 5.2 million tons of durum wheat this season, which is 2 million tons more than in the previous period.
As a result of geopolitical problems and imposed sanctions, the global agricultural market is expected to reduce the supply of wheat. Under such conditions, the demand for grain and its price will increase. To relieve some of the pressure, many exporters, such as Australia, the U.S., and Argentina are increasing shipments, but due to weather conditions, not all can offer large volumes.
In addition, not all farmers are ready to grow wheat, many of them are expanding their acreage for more profitable crops, such as soybeans or corn.