Posts
Soybean Shortage & Cyberattack on Food Supply Chain: Achilles' Heel
As local buyers like livestock feed makers vie with importers for a shrinking European cereal surplus, prices could continue rising until demand is dampened or next crops are harvested around the world, traders and analysts said.
China has been on an extended buying spree of global grain, partly due to a rebuilding of its pork industry after a swine disease epidemic.
Europe harvested a smaller cereal crop this year and rival wheat exporter Russia has shipped less than expected, while the EU’s main maize supplier Ukraine has grappled with drought.
“China has really upended the market,” a French trader said. “Everything is expensive and it’s all about exporting rather than importing.”
Tightening grain supply is not expected to be visible in food prices. Key suppliers like millers have advance cover, commodities are diluted by other supply chain costs, and supermarkets compete heavily on food staples.
But upstream, grain processors may have to slow buying if exports keep flowing out of Europe, traders say.
Loss of out-of-home food and beer demand due to coronavirus lockdowns may let them stretch their stocks to some extent, they say.
Yet they may have to limit buying further as the market awaits South American maize crops in the spring and next summer’s European wheat harvest, currently set to rebound.
“At the end of the day, we’re looking at a very strong need to ration wheat demand in Europe in the coming months,” consultancy Agritel said.
NO RELIEF IN MAIZE
Despite harvesting a quarter less wheat and barley this year, France is set to ship even more of those cereals to China than last season’s hefty volumes.
That has left room for Germany, Poland and the Baltic states to export more wheat to Algeria, usually overwhelmingly supplied by France.
The northern EU countries are also shipping wheat to Asian markets like Pakistan, as higher Russian prices and precautionary purchases by importers during the COVID-19 pandemic stoke demand.[GRA/TEND]
Exports of common wheat, or soft wheat, from the EU plus Britain in 2020/21 are running 20% below last season’s record pace. But that compares with a 40% lag two months ago. The gap could narrow further as large recent sales are shipped out.
Traders said several vessels of French feed barley have been sold for shipment to China in summer 2021, unusually early sales for the next crop that sent French barley premiums surging this month.
French barley sales to China have accelerated due to tensions between Beijing and main barley supplier Australia.
Within Europe, grain buyers have not found relief in maize either.
Ukraine’s drought-diminished crop has curbed expected flows to the import-reliant EU livestock industry, raising prices and prompting processors to use more feed wheat or secondary cereals.
Maize imports in 2020/21 so far by the EU and Britain - which remains in the EU’s single market until December - are 17% lower than a year ago.
South Korea has confirmed an outbreak of highly pathogenic H5N8 bird flu on a duck farm in the southwestern part of the country, the World Organisation for Animal Health (OIE) said on Monday. The outbreak, which occurred in the town of Girin-ri, killed 19,000 ducks, the OIE said in a website alert, quoting the South Korean agriculture ministry. Some 392,000 chickens and ducks at a total of six farms were killed preventively, the ministry also said.
No comments:
Post a Comment
Note: only a member of this blog may post a comment.