World and Brazilian wheat supply should be higher this season

Cepea, June 17, 2020 – Both the world and the Brazilian estimates for the wheat crop have been positive so far. In Brazil, attractive wheat prices and favorable weather in the major producing regions should increase production. As regards the top wheat-producing countries, forecasts point to higher production and exports.

 

BRAZIL – Wheat sowing has been favored by the weather in Brazil. Conab (Brazil’s National Company for Food Supply) estimates the area allocated to wheat to total 2.18 million tons, 10.4% larger than that in the previous season.

 

In Paraná, until June 15, wheat sowing had reached 79% of the area estimated for the state, according to data from Seab/Deral. Of the crops already sown, 82% are in good conditions, 15%, in average conditions, and 3%, in bad conditions.

 

In Rio Grande do Sul, according to Emater, the incidence of plagues and diseases in the crops already sown is low, and plants are growing fast. In Passo Fundo, growers are preparing the first areas to be sown – the total area allocated to wheat in this region is expected to be 30% larger than that last season.

 

WORLD – The USDA predicts the world wheat production in the 2020/21 season to be a record, totaling 773.434 million tons, 1.2% up compared to that last crop (2019/20), boosted by countries such as India, China, Turkey and Australia. World consumption, however, should remain stable, at 753.185 million tons.

 

World inventories should grow by 1.9% compared to that reported in May, totaling 316.089 million tons, and the inventory/consumption ratio should increase to 41.9%, against 41.1% forecast last month.

 

PRICES – In Brazil, wheat prices were following opposite directions in the first fortnight of June among the regions surveyed by Cepea, influenced by the low domestic supply and the dollar oscillations.

 

(Cepea-Brazil)

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