Cereals: Russia to lose market shares to the EU
July 16, 2019 at 11:39 AM ,
Der AUDITOR
EU to secure market shares from Russia
Due to the drought in many winter wheat growing regions in Russia, the USDA has lowered its production forecasts for the country by 3.8 million metric tonnes since May. Russia is expected to produce 74.2 million mt of wheat in 2019/2020, which is still more than last year and the second highest on record.
The USDA has also cut its production estimates for Australia, Canada, the EU and the Ukraine in July. The EU is now expected to prouce 151.3 million mt and the Ukraine 29 million mt. Nevertheless, Russia remains the front-runner in terms of exports. At 34.5 million mt, the country is the market leader by far, but is likely to lose market shares to the EU and the US due to the smaller production. Interestingly, the EU Commission argues the other way around. Accordingly, the trend of the last five years shows that the EU is losing shares in the key markets Saudi Arabia and Algeria to Russia.
In addition, the wheat exports from the Ukraine have been revised downwards to 19 million mt. The EU ishould export 27 million mt of wheat and the US an estimated 25.5 million mt. Due to the encouraging suppl ysituation, the EU is set to secure additional market shares in North Africa, sub-Saharan Africa and the Middle East.
Ukraine ranks third in the export market
In consideration all cereals including wheat, barley and oats, rye and coarse grains and corn the USA remains the undisputed leader in the export market with exports projected at 138.2 million mt. Export volumes are epxetced to climb in nearly all growing countries and regions, especially in Canada. Contrary to this, the exports from the Ukraine and Brazil are stagnating. Nevertheless, the Ukraine remains the third largest exporter with an estimated volume of 83.5 million mt. Although the USDA has revised its production estimates for wheat, the country is still set to produce significantly more than last year (2018: 25 million mt vs 2019: 29 million mt). Total grain production should increase nominally to 115.8 million mt (2018: 113.8 million mt) in the Ukraine.
|
Grain exports in 1,000 metric tonnes |
|||
|
Region |
2018/19 |
2019/20 |
Diff. |
|
USA |
135,870 |
138,210 |
+1.7% |
|
Argentina |
80,805 |
86,505 |
+7% |
|
Ukraine |
83,930 |
83,645 |
-0.3% |
|
Brazil |
68,045 |
68,010 |
-0.1% |
|
Canada |
36,360 |
58,820 |
+61.7% |
|
Russia |
52,310 |
55,680 |
+6.4% |
|
EU |
39,105 |
43,75 |
+11.8% |
|
Australia |
19,775 |
23,675 |
+19.7% |
|
Total |
561,561 |
591,566 |
+5.3% |
|
FAS/USDA July report |
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