Global wheat trade down 11%: USDA

By Kacey Culliney

- Last updated on GMT

USDA notes an 11% drop in global wheat trade
USDA notes an 11% drop in global wheat trade

Related tags: International trade

Tightening supplies and price surges have led to a slowdown in global wheat trade, according to the latest USDA report.

The United States Department of Agriculture (USDA) ‘Grain: World Markets and Trade’ report was released yesterday.

“Global wheat trade is down 11% as a result of tightening supplies and higher prices,”​ it said.

“Supplies in most major exporting countries are tightening, with stocks expected to be down 15 million tonnes from last year,”​ it added.

In the Black Sea region, overall wheat exports are anticipated to be half of last year’s total, with market share slumping to 14% from 25%. Tightened supplies have been put down to production-related shortfalls and export constraints in Ukraine, the USDA said.

“As Black Sea supplies dwindle, importers are already turning to higher-priced suppliers,”​ it said.

The report noted that US exports are up amid trade dips globally.

Eyes on India

“In an unusual development, India is providing needed supplies to global markets. India can now effectively compete as a result of tight global supplies and rising prices,”​ the USDA said.

The country is expected to export 5 million tonnes this year – the most it has done in nine years.

“This could be the tip of the iceberg as the country is currently saddled with a huge surplus and inadequate storage facilities,”​ the report said.

Hedging the costs…

In August prices of all wheat surged, with Soft White Winter (SWW) posting the largest gain, up $19 to $355 per tonne.

Francisco Redruello, senior food analyst at Euromonitor International, previously told BakeryandSnacks.com that US grain volatility would knock bakery and snack manufacturers in September.

“If price rises continue in August, it will increase in-put costs for bakery and snack manufacturers,”​ he said, and ultimately become a “significant”​ problem for firms. (See HERE​)

However, manufacturers should invest in forward contracts to hedge volatility, Jack Watts, a senior market analyst for the Argiculture and Horticulture Development Board (AHDB) and the Home Grown Cereals Association (HGCA) said. 

Trading: On the horizon

The USDA report identified some future changes in export and import trends across the globe.

USDA's forecast for the 2012/13 trading year on wheat exports and imports:

Exporting countries

Importing countries

Argentina - UP - strong July/August shipments

China - DOWN - lost incentive due to high prices

Brazil - UP - domestic wheat used for exports

Egypt - DOWN - high volumes purchased 2011/12

EU - UP - more competitive amid tighter Black Sea supplies

EU - DOWN -reduced availability of feed-quality wheat from Ukraine

Turkey - UP - increased supplies

Iran - UP - higher than expected purchases

United Arab Emirated - UP - higher import demands from Iran

Russia - UP - will up imports from Kazakhstan

Ukraine - DOWN - gov/exporters agreement to cut trade

Turkey - UP - government temporary import duty elimination

Related topics: Commodities, Bread, Ingredients

Related news

Show more

Related products

show more

Redefining fresh with premium maltogenic amylases

Redefining fresh with premium maltogenic amylases

DSM Food Specialties | 23-May-2022 | Technical / White Paper

Developed to address freshness challenges faced by bakers worldwide, DSM’s maltogenic amylase solutions enable the production of high-quality baked goods,...

The Era of the Mindful Nutritionist

The Era of the Mindful Nutritionist

Univar Europe Ltd. | 12-May-2022 | Technical / White Paper

Discover Wellness: Bakery Trends by Univar Solutions

Today's health-conscious consumers are increasingly demanding that ingredients...

The Era of the Mindful Nutritionist

The Era of the Mindful Nutritionist

Univar Solutions | 10-May-2022 | Technical / White Paper

Today's health-conscious consumers are increasingly demanding that ingredients are Better for Me and Better for the Planet.

Related suppliers

Follow us

Products

View more

Webinars