Buenos Aires, December 9, 2019. A rising concern is spreading within the wheat milling industry. The fever for the acceleration of wheat exports from the 2019/20 campaign could leave the industry short of raw materials.
Updated to Friday 6, close to 11 million metric tons of wheat were registered for export. Considering that the harvest could reach around 18.5 MMT, only 7.5 million will be available for the milling industry and exports throughout the next commercial season.
Industry purchases stand around 6 MMT each year, both to supply the domestic demand and to export (limiting to bordering countries like Brazil, Bolivia, and Chile). As the industry does not have the financial backing to bring purchases forward, they must buy wheat month by month. But the scarce remains of wheat could push prices up along the next year, pressuring the prices of flour and, ultimately, bread.
Sources of eFarmNewsAr in the industry are paying attention to the management of the wheat export registration. They think that the outgoing government let the export registration running, thus leaving a time bomb for the new government.
If final stocks of the present 2018/19 campaign reach a considerable volume around 3 MMT, the industry may feel relieved but the incoming authorities of the Ministry of Agriculture, Livestock, and Fisheries will have to deal with a very tight wheat supply scenario.