Coarse Grains. World Markets and Trade. April 2017 – USDA Апрель 11, 2017
Global corn production in 2016/17 is raised to a new record with larger record crops in both Argentina and Brazil. 2016/17 corn trade is expected to surpass the previous year’s record as importing countries take advantage of low prices. Both Mexican and Vietnamese imports are driven higher this month based on expected robust demand from their respective livestock sectors in the face of attractive global corn prices. The U.S. season-average farm price is unchanged at $3.40 per bushel.
Corn prices in Argentina and the United States are down this month as a result of record supplies in South America. Argentine prices were pared back $3/ton this month on the basis of ample availabilities, dropping to around $165/ton. U.S. quotes plunged following expectations of the impending South American harvest, retreating $13/ton to $157/ton. Black Sea prices were unchanged at $171, while Brazilian prices were seasonally unavailable.
Barley Prices Under Pressure
Barley prices for major exporting countries have witnessed significant declines since the beginning of 2016. Even though world barley production is projected down from the previous year, prices have not responded amidst pressure from a 2016/17 record global corn crop. Prospects for corn have affected barley demand as both are utilized as energy components for animal feed.
Barley prices have also been depressed by a record crop in Australia. The country is projected to be the largest exporter in 2016/17, supplanting the EU and supplying a quarter of the world’s demand. Compared with January 2016, Australian prices were nearly $30/ton lower year-over-year. Lower prices are expected to boost exports to key markets such as China. The implementation of the China-Australia Free Trade Agreement (January 2016) has provided Australia a competitive advantage with the removal of the import duty for barley. For the first two months of 2017, China’s imports of Australian barley more than tripled compared to the same period the previous year, according to Chinese customs data.
As a result of Australia’s competitive prices, other major exporters (i.e., EU and Ukraine) have felt downward price pressure since the beginning of 2016. Despite slightly lower production, EU prices are lower, and 2016/17 exports are forecast to be the second-largest behind Australia. For Ukraine, prices averaged $137/ton in January, decreasing over $20/ton year-over-year as a larger domestic crop has also pressured prices. Weak barley prices imply that growth in supplies of feed grains are outpacing global demand.
TRADE CHANGES IN 2016/17
- Argentine corn is raised 500,000 tons to 26.5 million on a record crop.
- EU barley is cut 500,000 tons to 5.4 million on a tepid pace as indicated by customs data and waning demand from North African countries.
- Russian barley is down 200,000 tons to 3.4 million on the lackluster speed of recent shipments.
- Ukrainian barley is up 200,000 tons to 5.2 million on data reflecting stronger-than-expected shipments and relatively competitive prices.
- Mexican corn is boosted 1.0 million tons to 14.8 million reflecting strong U.S. sales.
- Indonesian corn is halved to 500,000 tons on larger domestic supplies.
- Philippines corn is cut 200,000 tons to 700,000 on a record crop.
- South African corn is down 300,000 tons to 1.5 million on weakening imports in recent months.
- Venezuelan corn is cut 500,000 tons to 1.7 million on slower sales by the United States and Argentina.
- Vietnamese corn is raised 1.0 million tons to 9.5 million on expectations of greater demand for competitively priced feed grains.
- Moroccan barley is lowered 300,000 tons to 600,000 reflecting a slow pace of shipments from the EU and an improvement in early-spring pasture conditions relative to a year ago.
- Tunisian barley is down 200,000 tons to 400,000 on slow shipments from the EU.