Coarse grains

by Chrystal Shannon
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China’s production increases; Hungarian maize exports soaring

by Melissa Alexander

Global coarse grain supply, use and ending stocks projections for 2001-02 are on the rise from earlier estimates, while exports are expected to slip, according to the U.S. Department of Agriculture’s latest forecasts.

Global coarse grain production in 2001-02 was expected to reach 875 million tonnes as of mid-March, up more than 5 million from February estimates. The largest increase was in China, where forecast maize output was up more than 2 million tonnes to 110 million.

Estimates of total grain production recently released by China’s National Bureau of Statistics did not provide any breakout by type of grain, but other government agencies indicated maize production was larger than projected. China’s sorghum output also is expected to increase.

Although China suffered a second consecutive year of widespread drought, average maize and sorghum yields are thought to be better than in the previous year.

Mexico’s maize production in 2001-02 also was raised in the latest report, to 19 million tonnes, up 1 million. Growing conditions have been generally favorable and Mexican sources indicated that yields for the fall/winter crop were better than expected.

India also reported larger than expected coarse grains production, leading to a 1.6-million-tonne increase in its forecasts, including much more millet area and production and a small increase in maize output. South Africa’s maize production forecast also was raised by 500,000 tonnes to 9 million because of improved yield prospects in February.

Projected Argentine maize production was up 500,000 tonnes to 12 million, based on indications of higher than expected yields. Nonetheless, production remained down significantly from the previous year’s 15.5 million tonnes.

Global coarse grains use in 2001-02 was raised by about 2.5 million tonnes to 895.5 million, resulting in an estimated ending stocks draw-down from 2000-01 of about 20 million tonnes. China alone is expected to reduce its maize stocks by nearly 17 million tonnes in 2001-02, which, added to its previous years’ declines, would represent a drop of 37% in Chinese maize stocks since 1999-00.

China’s greater reliance on domestic supplies to meet consumption will cut its import needs, helping to explain the relative sluggishness in coarse grains trade. Global exports were forecast at 113.1 million tonnes, down slightly from the February estimates and down more sharply from 119.8 million the previous season.

China recently cancelled most of its purchases of U.S. maize made last fall. Despite China’s WTO entry last December, there is no indication that large maize imports by China are imminent, and its forecast imports were cut to only 250,000 tonnes from 1 million in February.

U.S. maize exports, which started the 2001-02 season at a relatively slow pace, were forecast to reach 48.9 million tonnes versus the February estimate of 50.2 million and previous year shipments of 49.16 million.

The real success story in coarse grains trade is Hungary, whose maize exports were boosted this month by 700,000 tonnes, to 2.5 million. In recent years, Hungary has become one of world’s top five maize exporters, in contrast to its earlier markets, which were limited mostly to Eastern Europe and the Soviet Union.

Following the fall of the Soviet Union, Hungary was plagued by low yields amid infrastructure problems and low input utilization. In recent years, however, an increased ability to afford inputs, improved transportation and relatively stable domestic feed consumption have allowed Hungary to expand its export focus.

Currently, Hungary is not only able to supply Eastern Europe but has substantially increased shipments to the E.U. and Mediterranean region. Hungary will be a growing force in the world maize market, USDA predicts.