03 February 2017

Flour exports expected to reach record high

At the mid-point in the 2016-17 crop season, the International Grains Council (IGC) again raised its forecast of global wheat flour trade, pointing to a new record up 2% from the prior season. For 2016-17, the IGC pointed to likely wheat flour volume of 15.5 million tonnes of wheat equivalent. This figure reflected an increase of 100,000 tonnes from the previous forecast and showed a gain of 200,000 tonnes from the prior peak in 2015-16.

Shipments at the indicated level this season would mark the fourth consecutive year in which global flour trade has increased. It has risen from the recent low flour trade of 12.65 million tonnes in 2012-13. From that point, world flour exports have gained 23%. In 2000-01, the beginning of the 21st century, world flour exports amounted to 8.824 million tonnes in wheat equivalent, with this year’s pace showing a gain of 76% over that level.

The IGC does not include shipments of durum semolina in its estimates of world flour exports. Such exports were forecast at 420,000 tonnes of wheat equivalent in 2016-17, up from 400,000 in 2015-16 and 390,000 in 2014-15. This raises the flour export prospect to 15.95 million tonnes, against 15.6 million in the previous season.

Primarily accounting for the export flour gains was the thriving export business of flour millers in Turkey. In its latest report, the IGC forecast Turkey’s flour exports in 2016-17 at 5.3 million tonnes in wheat equivalent, up 350,000 from the projection of just a quarter ago.

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Accounting for nearly (32.5%) a third of total trade in wheat flour, the Turkey outgo would approach being the largest amount of flour ever exported by a single country in history. In the aftermath of World War II, U.S. mills responded to emergency needs financed by the U.S. government to ship a peak of around 90 million cwts in a single year.

The wheat equivalent total forecast this year for Turkey roughly equals between 85 million and 90 million cwts, which is a remarkable achievement for a nation that first exported flour in 1984-85, shipping 7,000 tonnes of wheat equivalent, and which did not ship as much as 1 million tonnes until 2004-05.

The IGC cited “strong shipments to Iraq and Syria” as accounting for the dramatic increase in Turkey’s flour exports. Imports by Iraq from all sources were forecast at 2.2 million tonnes, against 2 million in 2015-16 and 1.488 million in 2014-15.

The other Middle Eastern nation torn by internal conflict, Syria, was forecast to import 600,000 tonnes of flour in wheat equivalent, up 100,000 from the prior projection and 110,000 more than actually taken in 2015-16.

For the entire Near East Asia, the IGC indicated imports this crop year would reach 3.49 million tonnes, compared with 3.17 million tonnes in 2015-16 and 2.36 million tonnes in 2014-15.

The flour import leader, by 100,000 tonnes, was Afghanistan. It was projected to import in 2016-17 a total of 2.3 million tonnes of wheat equivalent, about the same as 2.231 million in the prior year and compared with 1.816 million in 2014-15. It has been the world’s leading flour importer in most of the 21st century.

Only one other country was forecast to import more than 1 million tonnes of flour in 2016-17. This was Uzbekistan that is expected to take 1.250 million tonnes of wheat equivalent in 2016-17, against 1.2 million in 2015-16 and 1.137 million in 2014-15.

As part of the Commonwealth of Independent States, Uzbekistan was an important contributor to total takings of 1.8 million tonnes by this group of nations. The takings were closely in line with the previous two seasons.

On a continental basis, Far East Asia held the lead, with projected imports in 2016-17 of 4.34 million tonnes, against 4.21 million in the previous season and 3.94 million in 2014-15. Other than Afghanistan, no country in Far East Asia took even as much as 400,000 tonnes.

Imports by Africa this season were projected at 2.61 million tonnes, against 2.69 million in the prior crop year. Sub-Sahara countries account for most of that prospect, at 2.49 million tonnes, against 2.57 million in 2015-16.

Both North and Central America and South America are maintaining their pace of flour imports. For North America and Central America, the Council projected flour imports totaling 910,000 tonnes of wheat equivalent, against 960,000 in 2015-16. South American flour imports this season were forecast at 780,000 tonnes, unchanged from the preceding crop year.

After Turkey’s and Kazakhstan’s record-setting shipments, other exporters of wheat flour were showing minor changes from the recent pace.

The European Union was once again the only other exporter of at least 1 million tonnes of wheat flour in grain equivalent, which compared with 965,000 tonnes in 2015-16 and 900,000 in 2014-15.

The next ranking exporter of wheat flour will be Argentina in 2016-17, moving a projected 760,000 tonnes, against 717,000 in 2015-16.

Two countries — Ukraine and Pakistan — are seen as tying as shippers, each of 500,000 tonnes of flour in wheat equivalent.

The United States, which in earlier decades was the ranking exporter of flour, was seen as likely to ship only 435,000 tonnes this season, about the same as 440,000 shipped in 2015-16.

by Morton Sosland http://www.world-grain.com/