The global wheat market is not out of the woods. While the recent data from United States Department of Agriculture and the International Grains Council brought some comfort indicating prospects of a record wheat harvest in 2020/21, estimated at 768 million tonnes, a great part of it is still in the fields (springs wheat, see production calendar here). This means there is still some level of risk to crop conditions and yields.
The case in point is the eastern European region — specifically Romania, Poland and the Czech Republic – who are currently experiencing a dry spell. These three countries collectively account for roughly 25 million tonnes of wheat production, which equates to 3% of the global wheat harvest. This is not a small number in a crop whose trade policy is usually more political or sensitive as we have just recently witnessed with trade quotas and export bans.
For South Africa, all the aforementioned countries are amongst our key wheat suppliers. So, production conditions there are of interest to us. We are expecting wheat imports of 1.8 million tonnes in the 2019/20 marketing year that ends in September. About 61% of this was already in our shores on 08 May 2020. The 2020/21 season could have as large import volumes as this year or even more because of the expected lower domestic harvest in the crop that we are starting to plant.
I’m detailing all this to make a point that we will continue to be dependent on the global wheat market. Therefore, one should keep a close eye on developments in key wheat-producing countries. Eastern Europe’s weather conditions are something to watch closely over the coming weeks.
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