Prospects for grain markets

Июль 22, 2022

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Prospects for grain markets

Содержание

2. NO MAJOR THREAT FOR WHEAT SUPPLY IN THE WORLD DESPITE A LOWER CROP May 2017 World
3. LOWER CROPS AMONG MAIN EXPORTING COUNTRIES, EXCEPT IN EUROPE May 2017 EU-28: 150 Sub Sahara: 6,5
4. A LOWER US CROP BUT NOT A TIGHT S&D May 2017 A sharp drop in wheat
5. BLACK SEA COUNTRIES STRENGHTEN THEIR LEADERSHIP ON WHEAT TRADE May 2017 Black Sea: 51 Mto US:
6. A FAVORABLE LOCATION TO EXPORT TO MAIN CONSUMER COUNTRIES May 2017 A growing demand from the
7. RUSSIA: STILL A IMPRESSIVE EXPORT POTENTIAL DESPITE A LOWER CROP May 2017 Higher winter wheat acreage
8. FACTORS TO MONITOR IN RUSSIA May 2017 Ruble has appreciated by more than 10% vs US
9. UKRAINE: GOOD PROSPECTS FOR THE NEW CROP May 2017 Strong export demand this season to Asia,
10. MAIN DESTINATIONS OF UKRAINIAN AND RUSSIAN WHEAT May 2017
11. AFTER A SMALL CROP IN 2016, EU WHEAT S&D IS MORE BALANCED FOR 2017/18 May 2017
12. WHEAT AREAS CONTINUE TO EXPAND IN ARGENTINA May 2017 Since President Macri’s reform (removal of export
13. RECORD EXPORT POTENTIAL IN 2016/17 – RETURN TO NORMAL CROP IN 2017/18 May 2017 Port logistic
14. NOT A PERFECT WEATHER OVER WHEAT AREAS IN CHINA May 2017 A record crop is forecast
15. INDIA WILL HAVE TO IMPORT 5 MTO FROM JULY ONWARDS May 2017 Despite a better crop
16. CONCLUSION May 2017 Bearish factors: Record stocks in the world but half of them are located
17. May 2017 Prospects for corn market
18. WORLD CORN S&D APPEARS TIGHTER BUT STILL A LOT OF STOCKS MAI 2017 World production decreases
19. SHARP INCREASE IN SOUTH AMERICAN AVAILABILITIES MAI 2017 Despite the drop of production by 27 Mto
20. A LOWER CROP BUT STILL A COMFORTABLE S&D MAI 2017 Growth of soybean areas in the
21. STRONG COME BACK OF SOUTH AMERICA IN 2017/18 MAI 2017 Argentina and Brazil FOB prices very
22. BRAZIL: SAFRINHA EXPECTED TO RISE BY 21/22 MTO MAI 2017 +26 Mto After the last year
23. ARGENTINA: RECORD HARVEST WHICH SHOULD WEIGH ON PRICES MAI 2017 Despite very rainy weather on some
24. UKRAINE: GOOD EXPORT DYNAMIC // GOOD NEW CROP OUTLOOKS MAI 2017 Regularity of export flows at
25. EU REMAINS THE MAIN DESTINATION OF UKRAINIAN CORN MAI 2017
26. RUSSIA BECOMES AN EXPORTER ON WHICH WE MUST COUNT ON MAI 2017 Slight decline in plantings
27. A SLIGHT INCREASE IN EU CORN CROP IN 2017 MAI 2017 Sight increase of the french
28. DOWNWARD TREND OF PRODUCTION IN FRANCE MAI 2017 Downward trend of corn areas in France French
29. FRENCH EXPORTS IN DECLINE MAI 2017
30. THEORICAL DROP OF CHINESE STOCKS MAI 2017 Stocks down by 20 Mto according to USDA (production
31. CONCLUSION May 2017 Bearish factors: Record crops in South America and good prospects in North America,
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Слайд 2

NO MAJOR THREAT FOR WHEAT SUPPLY IN THE WORLD DESPITE A

LOWER CROP

May 2017

World wheat crop down by 15 Mto, mainly due to a lower crop (-13 Mto)
World wheat stocks continue to grow but this increase is only due to larger chinese stocks (+18 Mto in 2017/18 to 128 Mto, or 50% of world stocks…)
Excluding chinese S&D, stocks among exporting countries are expected to decrease in 2017/18.

Слайд 3

LOWER CROPS AMONG MAIN EXPORTING COUNTRIES, EXCEPT IN EUROPE
May 2017
EU-28: 150
Sub

Sahara:
6,5

China: 131

South East Asia: 35

Middle East: 42

Evolution / n-1

Exporting countries
Importing countries

North Africa: 20

Argentina: 16

Australia: 27

Canada: 29

Russia: 67

Kazakh: 13

US: 49,5

Amérique Centrale: 3,9

Ukraine: 24,5

India: 93

South America: 9,5

Слайд 4

A LOWER US CROP BUT NOT A TIGHT S&D
May 2017
A sharp

drop in wheat production as US farmers planted the lowest wheat acreage since 1909
A very wet growing season, which could alter the quality
HRW plains experienced a severe snow storms early May, with uncertain damages

Слайд 5

BLACK SEA COUNTRIES STRENGHTEN THEIR LEADERSHIP ON WHEAT TRADE
May 2017
Black Sea:

51 Mto

US: 27 Mto

EU: 28 Mto

Canada: 21 Mto

Australia: 20 Mto

Argentina: 9,5 Mto

Слайд 6

A FAVORABLE LOCATION TO EXPORT TO MAIN CONSUMER COUNTRIES
May 2017
A growing

demand from the Middle East and Asia is benefiting to Black Sea origins as freight is cheaper than out of Europe
Extension of port capacities in the recent years

Слайд 7

RUSSIA: STILL A IMPRESSIVE EXPORT POTENTIAL DESPITE A LOWER CROP
May

2017

Higher winter wheat acreage in Russia for the new crop but we expect a return to normal yield after record yields in 2016
Low winterkill during the past winter and good weather conditions so far despite cooler than normal

Слайд 8

FACTORS TO MONITOR IN RUSSIA
May 2017
Ruble has appreciated by more than

10% vs US dollar since the 1st of July 2016
Trade relationships of Russia with importing countries countries like Turkey
Which procurement policy next season regarding intervention stocks?

Слайд 9

UKRAINE: GOOD PROSPECTS FOR THE NEW CROP
May 2017
Strong export demand this

season to Asia, mainly India
Wheat quality from Ukraine is more and more appreciated by millers at destinations
Which quality for the harvest 2017?

Слайд 10

MAIN DESTINATIONS OF UKRAINIAN AND RUSSIAN WHEAT
May 2017

Слайд 11

AFTER A SMALL CROP IN 2016, EU WHEAT S&D IS MORE

BALANCED FOR 2017/18

May 2017

After the disastrous french crop in 2016, french yields should return to normal levels
Export potential will increase by at least 2 Mto in 2017/18
Weather has been particularly dry in northeastern France and Spain for a while

Слайд 12

WHEAT AREAS CONTINUE TO EXPAND IN ARGENTINA
May 2017
Since President Macri’s reform

(removal of export tax) in December 2015, wheat areas surged by 50%
Argentina is increasing its market share from January until April on the export market

Слайд 13

RECORD EXPORT POTENTIAL IN 2016/17 – RETURN TO NORMAL CROP IN

2017/18

May 2017

Port logistic runs at full capacity currently due to large barley shipments to China
After a record crop in 2016, wheat yields should return to normal levels
Diminishing risk of El Nino end of 2017 calendar year, which is rather favorable for wheat.

Слайд 14

NOT A PERFECT WEATHER OVER WHEAT AREAS IN CHINA
May 2017
A record

crop is forecast this year but there are some areas of concerns as wheat areas experienced dry and hot spells over the last two weeks.
Wheat stocks are forecasts to peak at 130 Mto but can we rely on this figure?

Слайд 15

INDIA WILL HAVE TO IMPORT 5 MTO FROM JULY ONWARDS
May

2017

Despite a better crop in 2017, demand keeps on rising rapidly in India and stocks are at a minimum level
After having imported almost 6 Mto this marketing year, India will have to import 5 Mto in the next marketing year to meet its growing demand.

Слайд 16

CONCLUSION
May 2017
Bearish factors:
Record stocks in the world but half of them

are located in China…
Good prospects for Black Sea crops
Expansion of wheat areas in Argentina
Very low farmer sales in Europe and Black Sea at this time of the year
Macro (debt in China, Trump politics, geopolitics) and currencies moves (US dollar, Russian Ruble, Brazilian Real, Argentinian Peso, etc.)
Bullish factors:
Wheat stocks among the main exporting countries are forecast to decrease by Mto in 2017/18
Lower wheat crops in the US, in Russia and in Australia
Demand from India will still exist in 2017/18
Storage capacities are growing around the world and farmers can be reluctant to sell at low prices

Слайд 17

May 2017
Prospects for corn market

Слайд 18

WORLD CORN S&D APPEARS TIGHTER BUT STILL A LOT OF STOCKS
MAI

2017

World production decreases after the record of 2016 but consumption increases (new record).
But the decline in world stocks by 29 Mto needs to be put into perspective given the decrease by -20 Mto in China.
Stocks still large for the main exporters.

Слайд 19

SHARP INCREASE IN SOUTH AMERICAN AVAILABILITIES
MAI 2017
Despite the drop of production

by 27 Mto in the US, the availability will remain large given beginning stock record at 58 Mto.
South America outlooks remain very positive => export potential increases by +23 Mto (+18 Mto in Brazil and +5 Mto in Argentina)
Stock cut policy implementation in China => decrease of stocks on « paper »

Слайд 20

A LOWER CROP BUT STILL A COMFORTABLE S&D
MAI 2017
Growth of soybean

areas in the US => drop by 4% of corn areas this year
Seeding progress in the normal pace after difficult early plantings
Ethanol demand remains dynamic
Exports should fall due to South American competition
US carry-over stock 2017/18 remains heavy

Слайд 21

STRONG COME BACK OF SOUTH AMERICA IN 2017/18
MAI 2017
Argentina and Brazil

FOB prices very competitives from July/August 2017

Слайд 22

BRAZIL: SAFRINHA EXPECTED TO RISE BY 21/22 MTO
MAI 2017
+26 Mto
After the

last year dryness, Brazil benefits from an almost ideal weather for the moment.
In addition, there is an upward trend of areas due to soaring domestic prices in the previous year.
But with the Brazilian Real rising, domestic prices fall and farmers are not sellers.
Political uncertainties could impact Brazilian Real evolution.

Слайд 23

ARGENTINA: RECORD HARVEST WHICH SHOULD WEIGH ON PRICES
MAI 2017
Despite very rainy

weather on some areas, corns were relatively spared.
Areas rising around 50% due to decision to remove export tax.
Interland and port supply-chains are complicated

Слайд 24

UKRAINE: GOOD EXPORT DYNAMIC // GOOD NEW CROP OUTLOOKS
MAI 2017
Regularity of

export flows at high levels for 5 years (17/19 Mto)
Corn areas expected to rise slightly to the detriment of barley

Слайд 25

EU REMAINS THE MAIN DESTINATION OF UKRAINIAN CORN
MAI 2017

Слайд 26

RUSSIA BECOMES AN EXPORTER ON WHICH WE MUST COUNT ON
MAI 2017
Slight

decline in plantings expected in the south of the country but also an increase in Central black soils in 2017.

Слайд 27

A SLIGHT INCREASE IN EU CORN CROP IN 2017
MAI 2017
Sight increase

of the french production can be forecast.
Decline of yields expected in central Europe, after the 2016 record.
Need of imports around of 12/13 Mto.

Слайд 28

DOWNWARD TREND OF PRODUCTION IN FRANCE
MAI 2017
Downward trend of corn areas

in France
French corn not very competitive for export=> Loss of export market share.

Слайд 29

FRENCH EXPORTS IN DECLINE
MAI 2017

Слайд 30

THEORICAL DROP OF CHINESE STOCKS
MAI 2017
Stocks down by 20 Mto according

to USDA (production down by 5 Mto and consumption up by +6 Mto).
Implementation of stocks cuts policy since May 2016.
Decrease in corn area in 2017 as announced by the government.

Слайд 31

CONCLUSION
May 2017
Bearish factors:
Record crops in South America and good prospects in

North America,
Large stocks in the US, still 30 % to sell in the farms,
South American currencies moves helping the origination
Bullish factors:
Record demand in the world for corn,
Weather market in front of us in Northen Hemisphere,
China’s stocks decreasing,
European S&D