Feed Materials Commentary
By Roger Dean
The grain market’s attention is now firmly focussed on the Northern Hemisphere’s 2020 harvest. The International Grains Council’s latest Grain Market Report
(GMR), published on 27 August 2020, projects a record world harvest of 2,230 million tonnes of wheat and coarse grains in the 2020-21 harvest year, as against 2,181 million tonnes in 2019-20. The latest estimate is also 5 million tonnes higher than in the GMR projection made in July. The forecast for world total wheat and coarse grains production in
2020-21 includes upward revisions for wheat, maize, sorghum and rye. On the consumption side, larger use of maize and sorghum for feeding livestock are the principal elements behind a 4 million tonne upgrade for projected total grain consumption, to 2,222 million tonnes, as against 2,181 million tonnes during the previous harvest year; it is also 4 million tonnes higher than the July GMR projection of 2,218 million tonnes. As a result, the forecast for world grain inventories at the end of the 2020-21 harvest year is increased by 5 million tonnes compared with the July GMR to 630m, an accumulation of 8 million tonnes year-on- year. The principal constituent of this increase is wheat. What the GMR describes as ‘the biggest maize harvest in history’ is
largely behind the projected near-50 million tonne jump in the 2020-21 world harvest of wheat and coarse grains. The world wheat crop is also expected to deliver a new high, while above-average outturns are also predicted for barley, sorghum, oats and rye. Total grain consumption is seen climbing by 41 million tonnes to 2,222 million tonnes, driven by use of grains for feed, up by 18 million tonnes compared to the previous twelve months, and industrial uses, up by 12 million tonnes on the same basis. Maize demand is seen rising the most, up by 33 million tonnes compared to the previous year. Cumulatively, an 8 million tonne increase in world grain inventories is projected at the end of 2020-21 to 630 million tonnes; this is projected to include increases in wheat (up by 14 million tonnes) and barley (up by 3 million tonnes). Conversely, however, 2020-21 is likely to see ‘the fourth consecutive contraction of maize inventories’, down by 12 million tonnes. The International Grains Council now includes soybeans in its
Grain Market Report. Global soybean output in 2020-21 is projected to increase by 10 per cent to a new peak of 373 million tonnes. This is driven by a significant increase in Chinese soybean demand. The United States Department of Agriculture’s Foreign Agriculture
Service (FAS) published its updated survey of world agricultural production (WAP) on 12 August 2020. FAS’ projection of world wheat production in 2020-21 amounts to 766.03 million tonnes, 3.28 million tonnes or 0.4 per cent less than in
PAGE 12 SEPTEMBER/OCTOBER 2020 FEED COMPOUNDER
their July projection. However, there are significant differences between countries.
Brazil’s 2020-21 wheat production is forecast at a record 6.8 million tonnes, up 1.1 million tonnes or 19.3 per cent on FAS’ July analysis, and up 1.6 million tonnes or 31 per cent from last year. Area is estimated at 2.32 million hectares, up 0.1 million hectares or 7 per cent from last month, and up 0.3 million hectares or 14 per cent from last year. Yield is estimated at 2.93 tonnes per hectare, an increase of 12 per cent from last month, up 15 per cent from last year, and up 14 per cent from the 5-year average. In contrast, FAS’ current projection of EU wheat production –
including the UK – is estimated at 135.5 million tonnes, down 4.0 million tonnes or 3 per cent, from FAS’ July estimate and down 19.4 million tonnes or 13 per cent from last year. It is also 14.2 million tonnes or 10 per cent below the 5-year average. Area is currently estimated at 24.8 million hectares, down 2 per cent from last month, and 5 per cent below last year; it was also 6 per cent below the 5-year average of 26.4 million hectares. Yield is estimated at 5.47 tonnes per hectare, down 1 per cent from last month, down 8 per cent from last year and down 4 per cent from the 5-year average. As regards individual EU countries, the largest reduction in EU
wheat production has taken place in the EU’s principal producer, France. New data, including an August report from the French Agriculture Ministry, has led USDA to make a 0.3-million-hectare reduction to France’s wheat area. This reduction is further indication of the excessive moisture last autumn that significantly prevented sowing of winter wheat. France’s harvested area is now estimated to be the lowest since 1994-95. With no change in yield, the lower area estimate resulted in a 2 million tonne fall in French wheat production – half of the total August reduction in EU wheat production. Recent data from the German Statistics Office confirms further yield deterioration in Germany due to drought. As a result, USDA has revised German area harvested lower, down 100,000 hectares to 2.8 million hectares and production down 0.8 million tonnes from July’s projection to 20.9 million tonnes. In addition, in Romania and Bulgaria, drought sapped grain fill, particularly in the south-east and southern regions of Romania and in north-east Bulgaria. This resulted in another reduction of 1.0 million tonnes in wheat production. FAS has revised its projection of world maize production in 2020-
21 upwards by 7.82 million tonnes or 0.7 per cent. This is largely attributable to the United States, reflecting a greater area planted and higher yields. There are a number of other relatively small changes in projected maize production elsewhere: reductions including Canada and the EU and increases in Serbia and the Ukraine. FAS has revised its projection of world soybean production in 2020-
21 upwards by 7.88 million tonnes or 2.2 per cent. The overwhelming bulk of this increase is attributable to the United States where production is currently projected at 120.42 million tonnes, 7.9 million tonnes or 7 per cent more than its July’s projection. The other significant factor in world soybean production is the estimated 99 million tonnes projected to be imported by China.
Comment section is sponsored by Compound Feed Engineering Ltd
www.cfegroup.com
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