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Wheat: The buoyant export rate will slip over 2018

December 29, 2017 at 9:07 AM , Starry Night Ltd.
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SOFIA. Exports to EU markets are forecasted to keep the robust trend. Yet, to markets outside the EU, regional behemoths squeeze out local export potential.

BULGARIA. Harvest 2017-18 has been quite a success for local farmers. The country realized the highest output – 5.9 mmt for at least a period of 20 years, while exports to EU markets have never been so buoyant. By the 22nd of December 2017, shipped volumes to countries of the EU reached close to 2.6 mmt while those of last year that time came close to 2 mmt, according to local authorities. There is no doubt, before having entered into 2018, local market players will have exported more than 3 mmt of wheat to the world.

Wheat: EU is the focus market while exports outside the Union lag behind

By the end of marketing season 2016-17 (June 30th 2017), the country exported 4,168,623 mt out of 5,662,721 mt aggregate production, according to the Ministry of Agriculture. This year, because of favorable weather conditions earlier in the season, farmers realized by 4.19% higher output while shipped volumes to EU markets rose by 30.15% higher than those of last year. Local market players remain optimistic in the short-term, forecasting exports to EU countries to keep the upbeat trend at least till the end of February 2018. Mainly, exports go to Spain, Greece, Italy, among others.

      Harvest 2017-18

(01.07.2017 - 22.12.2017)

           units in MT

Beginning availability

179,000

Aggregate output

5,900,000

Imports

46,358

Domestic consumption

908,800

   food

474,000

   feed

238,000

   seeds

180,000

   industrial usage

16,200

Exports to the world

2,991,985

   to EU markets

2,591,789

   to rest of the world

400,196

Source: Bulgarian Ministry of Agriculture

On markets outside the EU, Bulgaria does not command the same marketing power as regional market behemoths such as Russia and Ukraine do, and as a result, so far in the season, exports to such foreign destinations have lagged behind substantially or by 59.54% in favor of those of last year (2016-17: 989,132 mt). No drastic change is expected on that export front since the country’s export potential is undermined by strong supplies from market players within the Black sea region; even more so since Russia has realized a surplus production of 83 mmt, according to the most recent USDA report on World Agricultural Production.

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