Rising sub-Saharan imports seen driving global wheat trade to record high in 2017/18; Indian imports seen lower

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Global wheat trade is forecast at a record for 2017/18, with Sub-Saharan Africa – a major driver in the past decade — projected to have the strongest year-over-year import growth of any region, the U.S. Department of Agriculture said in its latest monthly report.

Stagnant production and rapid consumption growth have been the main motivators of rising import demand in the region, with consumption escalating on long-term trends of urbanisation, rising incomes, and population growth, it said in its World Agriculture Supply and Demand Estimate (WASDE) report.

This year specifically, record global production and relatively low prices have further catalysed import demand in Sub-Saharan Africa, the report added.

According to the report, Russia is an increasingly important supplier for the region as many of these markets are primarily focused on obtaining low-priced supplies. In light of Russia’s record crop and large exportable surplus, Sub-Saharan Africa’s demand growth has provided an outlet to absorb some of those excess supplies, it added.

After Sub-Saharan Africa, the region with the next largest projected growth in imports this year is the Middle East, the report said.

There, the report pointed out, higher imports are offsetting Iraq’s lower crop quality and Turkey’s diminished stocks.

In contrast, the largest forecast reduction from 2016/17 is for South Asia on account of sharply lower imports for India due to its ample 2017 harvest.

Also down from the previous year are imports for North Africa (larger crops for Algeria, Morocco, and Tunisia) and South America (reduced demand in Brazil).

Shekhar Ghosh is consulting editor, Indoasiancommodities.com. He has edited and written for publications like Business India, Business Standard, Business Today, Outlook and many other international publications. He can be reached at shekhar.ghosh@indoasiancommodities.in.

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