Beruflich Dokumente
Kultur Dokumente
by John Buckley
After a record
three-year boom in
production, world
soya crops had
been expected to
decline in the coming
2015/16 season as
farmers reduced area
and yields deflated
from the past years
unusually high levels.
However, the USDAs
first take on the new
crop balance now
suggests otherwise,
pitching the world
crop at 317m tonnes
level with the past
seasons record
output.
FUNDAMENTALS have tipped further in favour of the grain and feed consumer since our
April review as an ever loosening new crop supply outlook promises an extended period of cost
restraint. Until recently, the popular view among analysts had been for an inevitable decline in
crop yields from last years above normal levels and, in several key supplier countries, some
cutback in sowings in response to this seasons grain surpluses and low prices. But it was also
assumed the massive stocks carried over from the current season of plenty would cushion the
forward market against the crop decline so no reason for any drastic price increases.
In late May, it looks more bearish than that, however, thanks to a relatively mild winter, ideal
growing conditions in most of Western Europe, improving weather in the US and the CIS
countries, better spring planting conditions across North America, much bigger than expected
maize and soyabean crops being harvested down in South America etc etc.
Yes, wheat and maize crops may still be down a bit from last years record levels but only by
about 7.5m and 6m tonnes respectively, according to the US Agriculture Departments first
official WASDE* forecasts.
The global maize crop figure is the more surprising of the two, since several analysts were
talking, just two months ago, of a decline for this grain of 40m to 50m tonnes, based on smaller
crops expected in the USA, West Europe, South America and the former Soviet Union. However,
USDA is now looking for a US decline of only about 15m tonnes, South America down by
perhaps 2.5m, Europe 5m or so and the CIS less than 2m. Also, partly offsetting these, is a
forecast 12m tonne-plus crop increase for China, the worlds second largest corn producer and
consumer.
If the USDA is right (and there is a world of weather to get through before the main northern
hemisphere corn harvests actually start, from September onward) the global maize supply will
actually be about 19m tonnes larger next season than this when carryover stocks of 192.5m are
added onto the smaller crop. The world, then, may still be relatively awash with corn supplies
this time next year.
Global maize consumption, in turn, is expected to jump by about 13m tonnes next season due to
gains in China (+4m), Brazil (+2m, the US (+1.6m) and a host of moderate/smaller consuming
countries boosting their feed consumption of this now relatively cheap grain.
Even with these increases, however, maize demand will not outstrip the slightly smaller world
crop, leaving ending stocks by September 2016 at an almost identical level to this years with
stock/use ratio at a comfortable 19%.
Chances of actually reaching the 990m tonne
world corn crop are currently favoured by
several factors in the big five producing centres.
In the USA, the crop is piling in ahead of
schedule, favoured by recent plentiful rains and
may even beat the USDA planted area forecast.
Even the recent talk of an El Nino climate
event which can be a big problem for some
Asian crops in terms of a dry summers - has a
more positive effect on the Americas, tending
to promise moister, heat-wavefree conditions.
So USDAs 346m tonne US crop forecast might
even prove the low end of possibilities.
European maize area is also expected to fall
somewhat after last years record harvest but
crops here have so far been going in under
mostly favourable conditions. Output might
drop by about 5m tonnes but carry-in stocks are
larger than last years and, if consumption here gets to the 78.5m
tonnes forecast by the USDA, there should be no difficulty in
sourcing the required extra 4m tonnes or so of imports.
Concerns had been expressed about the CIS countries cutting
back on spring crop planting including maize because of
credit problems abnd inflating input costs resulting from their
chronically weak currencies in the wake of the hostilities between
Russia and Ukraine, western sanctions against Russia and the
collapse of the latters oil export revenue caused by falling crude
oil prices. In the event, neither country appears to be dropping
maize acreage much, Russia possibly even planting more. CIS
maize yields may fall if less inputs are used but so far, the USDA
is expecting the two big regional maize producer/exporters to still
turn out about 38m tonnes just 2m less than last year.
South American maize crops while technically included in the
2014/15 global balance do have a big impact on the calendar
year supply and 2015/16 season dynamics, being still in the midst
or tail end of their harvests as we go to press. USDA has actually
raised its estimate for the two big regional suppliers Brazil and
Argentina by about 3.5m tonnes in total although some local
analysts think this continues to under-rate Brazils contribution
by as much as a further 4m tonnes. Either way, Brazils slower
than expected export campaign (disrupted by transport and port
worker strikes) is leaving it, for the second year running, with far
larger than usual carryover stocks to bring into 2015/16 about
17-18m tonnes. The early outlook for the next Latin American
crop is again for ample supplies. USDA sees Brazil cutting back
on maize sowings a bit in response to farm credit issues and
T u r n k ey
Feed Mill
Systems
w w w. y e m t a r. c o m
Soya meal accounts for just over two thirds of all global oilmeal
supply and its also the leading high-protein, quality benchmark so where it leads, other sectors of this market will have to follow.
For feed consumers this is a useful equation in a year of
stagnating production of other major oilmeal sources as it will
keep prices under control across the sector. The second largest
oilmeal source, rapeseed, for example, is expected to see its
crop dip by about 5% due to cutbacks in Canada and Europe,
albeit, at about 68m tonnes still one of the largest crops ever.
Sunflowerseed output next season is seen stable at the past
years slightly lower level, cottonseed declines by about 6%
while groundnut meal increases by about 4.5% - though most
of the latter two meals are consumed mainly in the Asian
countries of origin. While soya will be called upon to supply
just about all the (10m tonnes) growth in global oilmeal demand
in 2015/16, it could clearly do that several times over on current
supplies. While the futures markets have small discounts on
forward soya meal prices it seems likely that these under-state
the extent to which costs could decline under this rich supply
scenario.
KEY FACTORS AHEAD - WHEAT
The size of Russias crop as low as 53m or as much 58m?
Either way it has large carryover stocks too and a reputation to
patch up as a reliable supplier. That should keep it in the van of
competitive sellers including Ukraine, helping to keep global
June 2015 | 79