Argentine wheat exports to Asia a record between February and March 2020
More than half of the 1.2 million tonnes of wheat that will arrive in the region between February and March are destined for Indonesia
Shipments of Argentine wheat to Asia are rising to record levels over the next two months as the drought slows Australian production and other offshore inventories.
Indonesia, Asia’s largest importer, is expected to Vietnam, Thailand and the Philippines to receive nearly 1.2 million tons of wheat from the South American country, operators said, that have access to shipping data.
“This year’s wheat volumes reaching Asia from Argentina are substantially higher than in 2019, which in itself it was a record year for Argentine supplies,” said one trader headquartered in Singapore and supplying wheat to millers flour from the region. He added: “Argentina has a great harvest for sell this year.”
The Buenos Aires Grain Market closed the harvest on Thursday, with a volume of 18.8 million tonnes, but the Rosario Stock Exchange put its estimate at 19.5 million tonnes, above the USDA’s 19 million forecasts in its last monthly report.
Argentina is expected to have exportable surpluses of around 12 million tonnes.
“More than half of the 1.2 million tons they will arrive between February and March heading only to Indonesia,” Trader.
Indonesia is expected to receive nearly 700,000 tonnes while ships with about 300,000 tons are expected to arrive at Vietnamese ports in the next two months. Thailand has about 150,000 tonnes of Argentine wheat on the way towards them. The Philippines is approaching about 60,000 tonnes.
For all of 2019, Indonesia bought 1.7 million tonnes of wheat from Argentina, according to data from Refinitiv Eikon, whilst Vietnam imported 182,000 tonnes and Thailand, 396,000 Tonnes.
Argentina became a key wheat exporter to asia in early 2019 when the third year of consecutive drought curbed wheat exports from the traditional supplier, Australia, and whilst grain stocks narrowed in the Sea region (Russia, Ukraine, mainly) after a hectic pace of exports.
On this last point, the Ministry of Agriculture of Russia is looking to establish a non-tariff quota for grain exports of 20 million tonnes between the present June, according to an official statement that was released on Tuesday past, where it was clarified that the quota would be removed for the start of 2020/2021 business cycle (since July).
Last month, Australia reduced its forecast wheat production by almost 20% by the 2019/2020 harvest, as a relentless drought on the country’s east coast will likely make the production drop to the lowest in 11 years.
In its January monthly report, the USDA reduced its estimate of Australia’s 2019/2020 wheat crop from 16.1 million tonnes to 15.6 million tonnes and its calculation of exportable balance from 8.2 million tonnes to 8.2 million tonnes. It should be remembered that, according to USDA figures, in the 2016/2017 cycle, Australian wheat production totalled 33.50 million tonnes and that its exportable balance was 23 million tonnes. From that campaign the climate sharply reduced the availability of Australian wheat.
Source: La Nacion