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Global Wheat Production to Reach 758.3M tonnes in 2020

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Global Wheat Production to Reach 758.3M tonnes in 2020

IndexBox has just published a new report: ‘World – Wheat – Market Analysis, Forecast, Size, Trends and Insights’. Here is a summary of the report’s key findings.

FAO’s updated projections indicate that global wheat production will reach 758.3 million tonnes in 2020, showing a slight decrease of 0.5 percent over the previous year’s highs and still at a fairly high level.

Despite general concerns about the COVID-19 situation, it is not expected to have any significant impact on wheat production this year. Potential yield declines due to unfavorable weather conditions in the EU, Ukraine and the United States will be offset by strong performances in Australia, Canada, Russia, and some Asian countries.

Total wheat production in Europe is projected to decline in 2020, constrained by a fall in harvests in the European Union (EU-27 excluding the UK), where total wheat production is expected to decline to 131 million tonnes. The decrease is due to a reduction in acreage, especially in France, the largest producer in the EU, due to excessive rainfall during the planting season.

In contrast, wheat production in the Russian Federation is projected to rise to 77 million tonnes, despite droughts in March and April, mainly due to an expansion in planted areas as wheat prices rise to record highs.

In Ukraine, wheat production is expected to decline to 25 million tonnes in 2020, which is 3.3 million tonnes less than in 2019, as a result of reduced planted areas and dry conditions in some regions.

In North America, unfavorable weather conditions in the U.S., including low temperatures and scarce rainfall, could affect wheat yields, leading to a decline in production to 50.8 million tonnes in 2020. In Canada, expanded winter plantings are expected to drive production to 34 million tons, assuming that yields and area sown with the spring crop remain unchanged.

In Asia, India’s wheat production in 2020 is projected to a record high of 105 million tonnes, largely due to increased planted areas driven by price increases. In Pakistan, favorable weather conditions will ensure production at 26 million tonnes, while in mainland China, the wheat output is expected to rise slightly.

In the Middle East, the overall outlook is also favorable. In Turkey, the largest producer in the region, wheat production is likely to rise to 20 million tonnes, up 5.3 percent from a year earlier. Results in neighboring countries are expected to remain unchanged from the previous year’s strong harvest.

In North Africa, dry weather in early 2020 will negatively impact harvest in Morocco, where production is projected at a four-year low, and to a lesser extent in Algeria and Tunisia, compared with highs in the previous year.

In the Southern Hemisphere, good crop prospects are expected in Australia, (21.4 million tonnes), Argentina (20.3 million tonnes), and Brazil.

Consumption By Country

The countries with the highest volumes of wheat consumption in 2019 were China (137M tonnes), India (102M tonnes), and Russia (43M tonnes), together accounting for 37% of global consumption. Turkey, the U.S., Pakistan, Egypt, Germany, France, Iran, Italy, and Algeria lagged somewhat behind, together accounting for a further 23%.

From 2009 to 2019, the biggest increases were in Algeria, while wheat consumption for the other global leaders experienced more modest paces of growth.

In value terms, China ($59.9B) led the market, alone. The second position in the ranking was occupied by India ($29B). It was followed by Turkey.

The countries with the highest levels of wheat per capita consumption in 2019 were Algeria (324 kg per person), Turkey (320 kg per person), and Russia (298 kg per person).

World Wheat Production

In 2019, global wheat production 762.2M tonnes, growing by 3.9% compared with the previous year. In general, production showed a relatively flat trend pattern. The growth pace was the most rapid in 2011 with an increase of 6.7% against the previous year. Over the period under review, global production reached the peak volume at 773M tonnes in 2017; however, from 2018 to 2019, production failed to regain the momentum. The generally positive trend in terms output was largely conditioned by a relatively flat trend pattern of the harvested area and a modest increase in yield figures.

Wheat Production By Country

The countries with the highest volumes of wheat production in 2019 were China (134M tonnes), India (102M tonnes), and Russia (75M tonnes), together accounting for 41% of global production. These countries were followed by the U.S., France, Canada, Ukraine, Pakistan, Australia, Turkey, Germany, and Argentina, which together accounted for a further 34%.

From 2009 to 2019, the most notable rate of growth in terms of wheat production, amongst the main producing countries, was attained by Argentina, while wheat production for the other global leaders experienced more modest paces of growth.

World Wheat Harvested Area

In 2019, the total area harvested in terms of wheat production worldwide reached 214M ha, stabilizing at 2018 figures. In general, the harvested area, however, continues to indicate a relatively flat trend pattern. The growth pace was the most rapid in 2011 when the harvested area increased by 2.2% year-to-year. Over the period under review, the harvested area dedicated to wheat production reached the maximum at 225M ha in 2009; however, from 2010 to 2019, the harvested area stood at a somewhat lower figure.

World Wheat Yield

The global average wheat yield reached 3.5 tonnes per ha in 2019, growing by 2.2% on the year before. The yield figure increased at an average annual rate of +1.4% over the period from 2009 to 2019. The most prominent rate of growth was recorded in 2013 when the yield increased by 5.5% against the previous year. The global yield peaked at 3.5 tonnes per ha in 2017; afterward, it flattened through to 2019.

World Wheat Exports

In 2019, global wheat exports expanded to 178M tonnes, with an increase of 3.9% on the previous year’s figure. The total export volume increased at an average annual rate of +2.9% from 2009 to 2019; the trend pattern remained consistent, with only minor fluctuations throughout the analyzed period. The pace of growth appeared the most rapid in 2014 with an increase of 7.7% against the previous year. Over the period under review, global exports hit record highs in 2019 and are expected to retain growth in the immediate term.

In value terms, wheat exports rose slightly to $39.9B (IndexBox estimates) in 2019. Over the period under review, total exports indicated a moderate expansion from 2009 to 2019: its value increased at an average annual rate of +2.9% over the last decade. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Based on 2019 figures, exports increased by +12.2% against 2016 indices. The growth pace was the most rapid in 2011 with an increase of 44% y-o-y. Global exports peaked at $49B in 2013; however, from 2014 to 2019, exports remained at a lower figure.

Exports by Country

In 2019, Russia (32.5M tonnes), the U.S. (27M tonnes), Canada (21.5M tonnes), France (20M tonnes), and Ukraine (20M tonnes) were the main exporters of wheat in the world, generating 68% of total export.  Argentina took the next position in the ranking, followed by Australia.

From 2009 to 2019, the most notable rate of growth in terms of shipments, amongst the leading exporting countries, was attained by Ukraine, while exports for the other global leaders experienced more modest paces of growth.

In value terms, the largest wheat supplying countries worldwide were Russia ($6.4B), the U.S. ($6.3B), and Canada ($5.4B), with a combined 45% share of global exports.

Export Prices by Country

In 2019, the average wheat export price amounted to $224 per tonne, flattening at the previous year. Overall, the export price, however, recorded a relatively flat trend pattern. The pace of growth appeared the most rapid in 2011 an increase of 36% year-to-year. As a result, the export price reached a peak level of $315 per tonne. From 2012 to 2019, the growth in terms of the average export prices failed to regain momentum.

Average prices varied somewhat amongst the major exporting countries. In 2019, the countries with the highest prices were Australia ($259 per tonne) and Ukraine ($258 per tonne), while Kazakhstan ($187 per tonne) and Bulgaria ($195 per tonne) were amongst the lowest.

From 2009 to 2019, the most notable rate of growth in terms of prices was attained by Australia, while the other global leaders experienced more modest paces of growth.

Source: IndexBox AI Platform