Miller Magazine Issue 107 / November 2018

96 MILLER / NOVEMBER 2018 MARKET ANALYSIS major exporters, while a further buildup is envisaged for China. A sixth consecutive rise in total grains trade is predicted, to a record, led by a tenth year of expansion for maize. Wheat shipments are expected to stay at a high level, albeit a little lower y/y, while those of barley could be at a new peak. With buying by China potenti- ally halving y/y, the volume of sorghum trade could be the least in seven years. Linked to area gains and improved productivity in le- ading producers, global soybean output in 2018/19 is seen advancing to a high of 369m t, a 29m y/y increase. Although the Brazilian planting campaign is progressing swiftly, the southern hemisphere outlook remains ten- tative at this stage. World use should continue to trend up on demand from global feed, food and industrial se- ctors, while inventory accumulation in major exporters, chiefly in the US, is anticipated to underpin a near-30% rise in end-season carryovers. China’s imports are ex- pected to fall for the second successive year. However, with bigger shipments to smaller markets in Asia, as well as to the EU and Africa, trade is forecast at a high of 155m t, up by 1% y/y. Although Brazil’s exports may retreat slightly, volumes would still be more than 15m t above average. Firm demand from Asian importers is expected to un- derpin a 1% y/y increase in global rice trade in 2018. This comes despite weaker buying interest from China, as well as potentially reduced dispatches to Africa. The 2018/19 production outlook is tentative, but appears positive, with gains in key exporters – including India, Thailand and the US – compensating for a drop in China. With food use set to reach a fresh peak, world stocks may contract, including a small decline in China amid of- ficial efforts to counter a build-up of supplies. Trade is predicted at a peak in 2019 on bigger deliveries to Near East Asia and Africa. MARKET OVERVIEW: World grains and oilseeds prices were mixed, respon- ding to occasionally divergent fundamental develop- ments. Wheat and soybean values strengthened but, with maize, barley and rice quotations weaker, the IGC GOI was virtually unchanged m/m. After touching a three-month high in mid-October, the IGC GOI wheat sub-Index eased slightly, but still gained by a net 2% from the last report, with underpin- ning stemming from a somewhat tighter global supply outlook. With seasonal harvest pressure and generally light export demand pressuring quotations in Ukraine and Brazil, the IGC GOI maize sub-Index fell by 2% in Octo- ber, marking the third successive monthly drop. The IGC GOI rice sub-Index was modestly lower m/m, as seasonal price declines in India and the US more than compensated for gains in Thailand and Vietnam, which firmed on hopes for large sales to the Philippines.