Miller Magazine Issue: 120 December 2019

95 MARKET ANALYSIS MILLER / DECEMBER 2019 Key factors to watch in the global grain market In a few weeks, we will skip the equator of 2019 which has seen a high level of vola- tility in agricultural commodities from tra- de wars, ASF, LatAm currency falling, and some another stuff. Now is a good time to look ahead because all these factors will continue to be key for commodity prices. Strong US dollar and weak peso and real already making LatAm grains more attra- ctive. Sustainable increasing in Black Sea production will push the market as well. Also, new Argentinian government could set a package of export duties. An ASF epidemic has culled about 55% of China’s hog herd in the last 12 months, as it spread through large swathes of Asia, creat- ing a global pork and animal protein deficit, Rabobank says. Major animal protein-exporting regions – including Europe, Brazil, and the US – have risen to the challenge of bridging the supply gap. However, their efforts have not been enough to prevent global feed consumption growth slowing to 1.5% in 2019, down from 2% last year. In 2020, China’s feed consumption is expected to rebound slightly, amid a con- certed move toward large industrial farms, commercial feed rations, slowing herd losses, and growth in other animal proteins. Rabobank expects China’s soybean imports will recover fully, back to the pre- trade war record of 94mmt, by 2020/21, assuming hog inventory re- covery shows some progress in 2020. But for me, it’s too optimistic, ASF still somewhere there. Elena Faige Neroba Business Development Manager, Maxigrain