Global wheat trade down

Global trade in wheat was estimated to have dropped sharply by over 6.2 million tonnes between July 2003 to June 2004 despite heavy imports by China and some other countries.

The prices of wheat in the international market, which tended to be firm up for most part of the year, was expected experience a downward pressure in the coming months following a large harvest in producing nations and anticipated reduction in import requirement in several countries.

The total wheat output in 2003-04 is estimated at 596 million tonnes, about 37 million tonnes more than the preceding year.

The decline the world wheat trade in the year ending this month was attributed by the United Nations Food and Agriculture Organisation (FAO) chiefly to reduced imports by the European Union where the demand for feed wheat has fallen substantially.

Besides, reduction in imports owing to above-average production in several other traditional wheat importing countries, such as Afghanistan, Algeria, Brazil, Iran and Tunisia, also contributed to the overall decline in world wheat trade.

On the whole, the total world-wide wheat consumption in 2003-04 has been estimated to be around 606 million tonnes, down 8 million tonnes, or nearly 1.3 per cent, from the previous year's level.

It was about 2 per cent below the long term average annual consumption.

Wheat use as human food during the year was assessed at about 439 million tonnes, reflecting an increase in line with world population growth.

The per capita consumption would be around 70 kg a year in the world and about 62 kg in the least developed food deficit countries.

The end-of year global stocks of wheat were projected at around 139 million tonnes, down 48 million tonnes, or 25 per cent, from the previous season.

The biggest decline was likely to be in China. Inventories in India were also expected to drop sharply after a sharp fall in production and three consecutive years of heavy wheat exports from government stocks.

Besides, smaller carryovers have been forecast in the EU owing to fall in production and drop in imports. Poor 2003-04 wheat harvest in the Russian Federation would result in drawdown in grain stocks there.

Recovery in wheat production in many African countries was understood to have led to a reduction in import demand in Africa as a whole by nearly 4.8 million tonnes to 22 million tonnes.

However, wheat purchases by the region's largest importer, Egypt, remained steady at around 6.4 million tonnes despite some recovery in domestic wheat output during the year.

On the export front, traditional major wheat exporters, such as Argentina, Australia, Canada and the US, were reported to have increased their market share thanks to the withdrawal from the market of some of the new and emerging wheat exporters like India, the Russian Federation and Ukraine.