Markets

Global grains under the spotlight: IndexBox

IndexBox, May 24, 2018

IndexBox’s global grain market report – key findings and insights:

Cereal grains consumption continuing to increase

FROM 2007 to 2016, the global cereal grains market showed an upward trend, expanding by 4 per cent, to 2676 million tonnes (Mt) in 2016.

According to estimates by US-based market researcher, IndexBox, over the last nine years the cereal grain market grew with a compound annual growth rate (CAGR) of +2.6pc.

Maize accounted for the highest share (42pc in 2016) of global cereal grains consumption, followed by wheat (28pc), rice (19pc), barley (5pc), sorghum (3pc), millet, oats and triticale (about 1pc each).

In value terms, the market kept at the same level of 2015 and stood at $632B in 2016.

From 2007 to 2016, the market value was subject to significant fluctuations against changes in prices, crop yield and global cereal grains reserves.

China ranks first in global cereal grains consumption

The countries with the highest consumption were China (20pc based on tonnes), the United States (15pc), India (9pc), Brazil (4pc), Indonesia and Russia (3pc each), together comprising almost 54pc of global consumption.

The highest annual rates of growth with regard to cereal grains consumption from 2007 to 2016 were recorded in Brazil (+5.7pc) and China (+3.5pc).

Amongst the leading consuming countries, high levels of per capita consumption were recorded in the US (1254 kg/year), Brazil (503 kg/year) and Russia (492 kg/year), while the global average per capita consumption of cereal grains was estimated at 364 kg/year in 2016.

In the medium term, cereal grains market set to continue modest growth

It is expected that global cereal grains consumption will grow to 3.0 billion tonnes (Bt) by 2025.

In the medium term, consumption of cereal grains will grow at a slow rate (about +1.4pc per year), mainly due to increased demand for cereal grains in Asian and African countries.

By 2025, maize consumption will increase to 1.32Bt. It is expected that maize for feed consumption will grow due to the rapid livestock growth in developing countries. Maize for human consumption will also grow mainly in developing countries, especially on the African continent.

According to expectations, the consumption of wheat will increase to 813Mt. Wheat will be mostly used for human consumption. It is expected that the use of wheat for feed will increase primarily in Asian countries: China, Pakistan and Vietnam. The expected share of using wheat for biofuel production will be about 1pc of world wheat consumption in 2025.

Rice for human consumption remains the main way of consuming rice, as this product is a staple food in most Asian countries and is also popular in Africa, Latin America, and the Caribbean. It is expected that the total consumption of rice will rise to 570Mt by 2025 against the backdrop of Asian and African population growth.

2016 cereal grains production

Cereal grains production reached 2701Mt in 2016, with a positive dynamic being recorded over the last nine years.

Maize accounted for the highest share (42pc in 2016) of global cereal grains manufacturing, followed by wheat (28pc) and rice (19pc).

The cereal grains production value amounted to US$637 billion in 2016.

From 2007 to 2016, the production of cereal grains showed a mixed pattern.

Due to the fall seen in exporter prices, cereal grains production in value terms remained stable in 2016, against the growth in output figures over the last year.

All key cereal grains producers increased production volume

The output of the five major producers of cereal grains, namely China (524Mt), the U.S. (486Mt), India (253Mt), Brazil (119Mt) and Russia (103Mt) represented about 55pc of global cereal grains output.

All main producer countries showed upward trends in cereal grains output: Brazil (+6.7pc per year), Russia (+3.6pc per year), China (+3.0pc per year), the U.S. (+1.9pc per year) and India (+1.7pc per year).

US the largest exporter of cereal grains

In 2016, the volume of global exports totalled 390Mt, which was 3pc less than the year before.

However, from 2007 to 2016, the global cereal grains exports indicated a steady growth, with a CAGR of +2.9pc.

The US (23pc) was the main supplier of cereal grains in the world.

Besides the US other major suppliers were Russia, Argentina and France (8pc each).

All these countries (including the US) together made up a 47pc a share of global exports.

While Russia’s exports (+8.4pc per year) steady increased over the period under review, Argentina, France and the U.S. cereal grains exports were relatively stable from 2007 to 2016.

In addition, Russia (+3 percentage points from 2007-2016) strengthened its position in the global cereal grains export arena, while the share of the U.S. (-10 percentage points) decreased significantly.

Japan and China main importers of cereal grains

The volume of global cereal grains imports totalled 365Mt in 2016.

Imports dynamics was generally in line with exports: globally, these trade flows complement each other.

From 2007 to 2016, global cereal grains imports steadily increased, with a CAGR of +2.8pc, however, some noticeable fluctuations were observed.

Japan and China (6pc each) were the main consumers of cereal grains imports.

Except Japan and China, the main importers of cereal grains were Mexico (15.2Mt), South Korea (14.6Mt), Spain (14.5Mt), Algeria (13.3Mt) and Saudi Arabia (13.2Mt), all these countries together amounting for 32pc share of global cereal grains imports.

China had the highest growth rates of imports +36.2pc per year. Other countries had more moderate growth rates per year: Algeria (+7.1pc), Saudi Arabia (+3.0pc), South Korea (+2.1pc), Spain (+1.7pc) and Mexico (+1.5pc).

While the share of China in terms of global imports of cereal grains (+6 percentage points) increased, the share of Japan (-3 percentage points) decreased from 2007 to 2016. The shares of the other countries remained relatively stable throughout the analysed period.

Source: IndexBox, https://indexbox.io/store/world-cereal-grains-market-report-analysis-and-forecast-to-2020/

 

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