Wheat: A shift in some domestic demand trends
March 8, 2018 at 3:39 PM ,
Starry Night Ltd.
BULGARIA. Total availability of wheat for the current season reached 6.1 mmt; as 5.9 mmt was collected during harvest 2017-18 while the rest come from a carry-over of 179,000 mt and up-to-date imports of 53,952 mt. On an annual basis, imports represent a small share of total availability since approximately a third of national output will meet domestic demand while the majority of the locally harvested wheat is customarily exported to foreign markets.
Wheat: domestic demand features
Yearly, the largest share of local demand goes to the food sector. A substantial shift in demand could be expected from changing diet and lifestyle habits, indeed of the younger generations, of local consumers. As people become more health conscious of what they consume on an everyday basis and seek better alternatives to existing bakery products, demand for customary bakery products change, which directly influences demand for raw materials. By the end of last week, the food sector consumed 664,000 mt of wheat while by that time last year, the number reached by 713,600 mt, according to local authorities. The trend is forecasted to continue.
The second largest share goes to the feed sector, as depending on the dynamics of the export markets, local consumption fluctuates. Up-to-date exports to markets of the Union have been strong since the beginning of the current season. According to some local intermediary market players, quantities of feed wheat for exports could not be found on the market so far in the marketing year. By the 2nd of March 2018, consumption by the livestock sector reached 338,000 mt or by 3.43% less than that of last year by that time.
|
Harvest 2017-18 (01.07.2017 - 02.03.2018) units in MT |
|
|
Beginning availability |
179,000 |
|
Aggregate output |
5,900,000 |
|
Imports |
53,952 |
|
Domestic consumption |
1,204,800 |
|
food |
664,000 |
|
feed |
338,000 |
|
seeds |
180,000 |
|
industrial usage |
22,800 |
|
Exports to the world |
3,524,010 |
|
to EU markets |
3,041,614 |
|
to rest of the world |
482,396 |
Source: Bulgarian Ministry of Agriculture
Share of exports to EU vs. non-EU markets
If the current export season is divided between sipped volumes to EU markets and non-EU markets, those to the former have recorded a substantial share of 51.55% out of total output while those to non-EU markets a share of merely 8.18%, which on a yearly basis trail behind exports of last year by 63.08%. Competition within the Black sea basin since early in the season have exerted quite a pressure on exports to non-EU markets. No change in trend is foreseen!
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