Higher wheat exports led to stagnated domestic use compensated by increased consumption of barley and corn, mainly for feed and industrial use. Overall grain use has been stimulated due to improving feed demand as a result of better livestock inventory and good “industrial” use for ethyl alcohol/ethanol production.
According to the USDA, market year 2016-17 wheat exports have been at a record high due to abundant supply, much better quality, and dynamic export demand. As of the end of April 2017, the country had exported 3.9 million tonnes of wheat, 1.5 million tonnes more than a year ago, 374,000 tonnes of barley, and 867,000 tonnes of corn. Active wheat exports depleted previously accumulated stocks.
Domestic feed wheat consumption was slightly higher due to much better availability. However, fast-growing exports and good wheat quality led to appreciating prices and feed mills had to switch to less expensive alternatives such as barley and corn, the USDA said. The local dairy, livestock and poultry industries see stable or increasing animal inventories and some feed mills successfully exported ready feed to Romania and/or other neighboring countries. It is expected that feed exports will likely grow in market year 2017-18 with expanding capacities of several feed mills. Bulgaria is in the process of being approved by China to export feed to this market and the first such exports are likely to begin in market year 2017-18. The USDA estimates wheat feed use in the current season is about 3% more than in market year 2015-16.
A gradual decrease in wheat consumption for food has been ongoing over the last 10 years driven by changing eating habits, demography and lifestyle. The first official data for 2016 indicates that this trend has continued with a 1.4% decline in annual consumption of bread, bakery products and flour by households, 88.0 kg per capita of bread and bakery products and 8.9 kg per capita of wheat flour. Official data about wheat flour production also show a modest decline. Wheat flour output declined from 508,000 tonnes in 2014 to 503,000 tonnes in 2015, and reportedly stagnated in 2016. Currently the USDA estimate’s wheat used for food purposes is 940,000 tonnes.
There has been a higher usage of wheat (and corn) for ethyl alcohol for spirits and medicinal purposes and ethanol due to better wheat availability. Grains estimated to meet this demand are used in a proportion of 30% wheat and 70% corn. The USDA estimates for wheat use for industrial purposes is currently at 60,000 tonnes for market year 2016-17 compared to 50,000 tonnes in market year 2015-16. The country remains a net exporter of ethyl alcohol. In 2016 exports grew by 6.8% while imports declined by 9%.