by PressWheat trade in the current season will exceed the figures of the previous season
Wheat trade on the world market: overview of the situation
FAO analysts have made a forecast for the agricultural market. They promise that wheat trade in the current season will exceed the previous period. This figure will be at the level of 467 million tons, which is 5.9% higher than that recorded in the previous season.
Increase in the volume of wheat supply is primarily due to the activity of China at the agricultural level. Following record imports of corn and barley, the country continues to increase purchases of feed wheat as well. The current forecast is 2% higher than the trade increase estimate that was released earlier. In addition to China, Morocco and Pakistan have shown interest in grain.
At the same time, analysts note that the next season may reduce the volume of trade in wheat. It is expected that the purchase may decline by 1.8% to 185 million tons. This decrease is primarily due to reduced imports from China, in addition, Morocco and Pakistan will also satisfy their need for grain, and their activity on the world market will fall.
As for exports, this season European Union countries and Argentina will increase grain sales. Here, favorable climatic conditions are predicted to increase the volume and quality of the crop. At the same time, a reduction in supplies will be observed in Australia, Russia and Canada, which are considered major producers of agricultural products. These countries will experience less favorable weather, which will affect crop yields. The U.S. will also have to reduce export shipments due to the need to replenish domestic stocks. Livestock in the state is expected to increase, which contributes to the demand for feed in the domestic market.
In addition, experts note that there is an increasing demand for soybeans and wheat in the world, and many countries are already increasing acreage for these crops. For example, this season Ukrainian farmers decided to focus on growing soybeans and wheat instead of corn and sunflower, which was observed in previous periods. This situation is primarily due to trends on the world market, where the level of profitability of corn has significantly decreased. This factor influences the formation of areas under crops and farmers rely on it when they plan the volume of sowing of one or another crop. At the same time, analysts promise an increase in the profitability of soybeans by about 20%.
As for the demand for wheat, in this case it will be influenced by the yields in the world as a whole. In addition, an important role is played by government regulation of exports. A high crop will lead to a fall in grain prices, which is a disadvantage for farmers.