Wheat: Lagging behind on markets outside the EU
January 18, 2018 at 11:07 AM ,
Starry Night Ltd.
BULGARIA. During harvest 2017-18, according to local authorities, the country realized 5.9 mmt of wheat - the highest figure for at least a period of two decades. During harvest 2016-17, local farmers produced 5.6 mmt of aggregate output while exports reached 4.16 mmt. So far, EU exports have been remarkably encouraging since early in the marketing season while those to non-EU markets have been terribly disquieting. Considering the export potential of the big market players within the Black sea basin, local market sentiments forecast exports to non-EU markets to most probably drag their heavy shadow till the end of the current marketing season. That might quite well affect the potential of the country to repeat its exports success of last year!
Wheat: upbeat EU exports while non-EU exports remain beaten down
According to the Ministry of Agriculture, by the 12th of this month, exports to EU markets reached 2,656,589 mt, which on a year-to-year basis is by close to 30% higher. Indeed, by the end of the second week of 2018, local market exporters shipped more wheat to EU markets than they had done so during the whole previous marketing season (ending 30th of June 2017). However, exports to the rest of the world stood at 414,196 mt, which annually represents a cut of 60.06%. Competing for foreign markets outside the Union, the country has lost positions to the big regional players. The trend is expected to continue, and most probably, will dent heavily in the aggregate export rate for the current marketing season.
|
Harvest 2017-18 (01.07.2017 - 12.01.2018) units in MT |
|
|
Beginning availability |
179,000 |
|
Aggregate output |
5,900,000 |
|
Imports |
46,358 |
|
Domestic consumption |
997,600 |
|
food |
531,000 |
|
feed |
268,000 |
|
seeds |
180,000 |
|
industrial usage |
18,600 |
|
Exports to the world |
3,070,785 |
|
to EU markets |
2,656,589 |
|
to rest of the world |
414,196 |
Source: Bulgarian Ministry of Agriculture
Domestic market dynamics
Some important changes, predicted to have long-term consequences, have prevailed on the local market. By the 12th of January 2018, total local consumption reached 997,600 mt, which on a year-to-year basis is a drop of 13.57%. A substantial decline (9.23%) in wheat for food consumption is observed, which is believed to be the result of consciously exercised new dietary habits and adopted changing life styles. The trend is expected to continue as customers seem to prefer to adjust their dietary preferences for higher-end bakery products and choose among diverse sets of alternatives. Wheat for feed, on an annual basis, is also down (5.63%) because of strong exports, starting early in the marketing season, which necessitates mills to switch to alternative grains. The trend is forecasted to continue since the great majority of feed wheat has already been exported.
View related articles
