Hot, dry weather in some major wheat exporting regions has caused world markets to react from fears of a short crop as occurred in 2010. According to the Foreign Agricultural Service (एफएएस) of USDA estimates released in early May, wheat trade of 145.1 मिलियन मीट्रिक टन (एमएमटी) accounts for 20.9 percent of this years wheat consumption. Since 2000/01, annual global trade has varied from 17.4 प्रतिशत 22.4 percent of consumption. As the world population continues to urbanize and diets change, wheat trade will likely become more important.

Nine countries plus the 27 countries of the European Union provide over 90 percent of the wheat exported in 2011/12 marketing year. The largest supply region is North America at 44.8 एमएमटी, 30.8 कुल का प्रतिशत, with the U.S. पर 27.5 एमएमटी और कनाडा में 17.3 MMT. The Black Sea region is the second largest at 35.5 एमएमटी, 24.5 कुल का प्रतिशत, with Russia at 21.0 एमएमटी, Kazakhstan at 9.5 MMT and Ukraine at 5.0 MMT. Australia is the third largest region at 21.5 एमएमटी, 14.8 कुल का प्रतिशत, and the EU-27 is fourth at 16.5 एमएमटी, 11.4 percent. Argentina is fifth at 10.5 एमएमटी, 7.2 प्रतिशत, and Turkey sixth at 4.0 एमएमटी, 2.8 प्रतिशत.

Market worries about supply are based on uncertainties in expected output and possible disruptions in exports by government policies. Forecasts for dry weather in the southern plains of the U.S. which produces hard red winter wheat, after a devastating drought in 2011, have raised concerns in North America. The other growing regions in North America are not facing weather concerns now and the U.S. and Canada will maintain open markets. The Black Sea countries are all facing some weather stress in winter and spring wheat crops and have a history of imposing export controls in short crop years, समेत 2010/11.

Australia has produced large crops in recent years, but can have a 50 percent decline in output in dry years, and does not restrict trade in short crop years. Recent high prices may encourage more wheat planting in Australia. The EU-27 is the worlds largest wheat producer and usually does not have wide variations in production. It does not restrict exports. Argentinas production is less variable than Australias, but the government does regulate agricultural exports and would likely intervene to protect domestic consumers from higher wheat prices. Turkey is both an importer and exporter and not likely to have much market impact.

अमेरिका. is important as the supplier that can meet additional demands if there is a short crop in another region or a policy intervention to limit exports. In 2010/11 अमेरिका. exported 35.1 गेहूं की एमएमटी, ए 46.9 से प्रतिशत की वृद्धि 23.9 MMT the previous year. In 2007/08 यह निर्यात 34.4 MMT a 39.3 से प्रतिशत की वृद्धि 24.7 MMT in 2006/07. The FAS wheat export estimate for the U.S. के लिये 2012/13 made in early May was 31.5 एमएमटी, यूपी 14.5 से प्रतिशत 27.5 एमएमटी इस साल.

Total global wheat end-of-year supplies on June 30 this year are projected to be 197.0 एमएमटी, down slightly from 200.1 MMT two years ago just before the Black Sea drought. Despite all the concerns about adequate supplies in 2010/11, end of year stocks fell only 3.4 एमएमटी के लिए 196.7 MMT. That was nowhere near the recent low for stocks at the end of the 2007/08 marketing year of 125.6 MMT. In early May, the FAS projected global stocks on June 30, 2013 to be 188.1 एमएमटी, नीचे 8.9 MMT from this year. That assumes world production will decline 17.0 एमएमटी में 2012/13 सेवा 677.6 एमएमटी, with the U.S. production up 6.7 MMT and Canada up 1.7 MMT. All of the other major exporters are expected to be down with Russia down 0.3 एमएमटी, Ukraine down 8.9 एमएमटी, कजाखस्तान 7.7 एमएमटी, the EU 5.4 एमएमटी, ऑस्ट्रेलिया 3.5 एमएमटी, अर्जेंटीना 2.4 MMT and Turkey 1.3 एमएमटी. Private forecasters are already reducing further their estimates of Russian production and exports for the new crop year. This may be partly offset by India deciding to export up to 4.0 MMT of excess wheat stocks.

Global wheat consumption is projected by FAS to be down 7.9 एमएमटी में 2012/13 सेवा 686.5 MMT mostly due to less feeding of low quality wheat to livestock. It will still be the second largest consumption year for the world and exceed the third largest year by over 30 MMT. A large demand base has been built that will not be reduced without substantially higher prices.

Imports are concentrated in a few countries, but are spread among almost all countries. The largest importer for the 2011/12 marketing year is Egypt at 10.5 एमएमटी, 56 percent of its wheat consumption. Egypt must unload four ships per week, all year, each containing 50,000 metric ton of wheat. The EU-27 countries are the second largest importer at 7.5 के लिए एमएमटी 2011/12, 6 percent of consumption. As large importers and exporters of wheat, the EU-27 is buying high quality wheat delivered to various country locations. The third largest importer is Brazil at 7.0 एमएमटी, 63 percent of consumption. Indonesia is importing 6.7 एमएमटी, 100 खपत का प्रतिशत; जापान 6.4 एमएमटी, 95 खपत का प्रतिशत; एलजीरिया 6.1 एमएमटी, 68 खपत का प्रतिशत; दक्षिण कोरिया 5.4 एमएमटी, 100 खपत का प्रतिशत; मेक्सिको 4.8 एमएमटी, 64 खपत का प्रतिशत; and Nigeria 3.9 एमएमटी, 100 percent of consumption. Any disruption of deliveries due to poor crops or changes in trade policies will be disruptive for these major importers.

The importance of wheat imports can also be seen on a regional basis. For the 2011/12 marketing year North Africa, including Egypt and Algeria, is the largest importing region at 22.7 एमएमटी, 55 खपत का प्रतिशत. The Middle East, the second largest region, is importing 20.1 एमएमटी, 36 percent of consumption. The regions are major shippers of oil to the rest of the world, but importing wheat into the region is also important for the people in the region.

Wheat carryover supplies and production in 2012/13 look adequate for now, but major buyers should be cautious. Traders have a saying that the grain crop is lost four or five times each year because the weather is too cold or too hot, too wet or too dry, or due to some other condition like disease. Rain or cooler weather can quickly change crop conditions for the better, or continued hot, dry weather can further hurt yields. Consumers in urban areas depend on international trade to keep them adequately fed by maintaining grain flows regardless of yearly crop conditions.

Ross Korves is an economic policy analyst with Truth About Trade and Technology