China became top buyer on the world barley market, ousting Saudi Arabia

18.05.2018

USDA revised upwards its estimates of world barley exports in 2017/18 MY compared to initial forecasts, made in the first half of the season. May estimates were increased by 600 KMT up to 28 MMT. This is 7% higher than the five-year average.

Upward revisions were made considering stronger import demand from China, Iran and Turkey. Though, due to high barley carryover stocks in Saudi Arabia, lower shipments are seen in this destination.

Over July-February 2017/18 MY, actual world barley exports were 10% higher than last year, reports UkrAgroConsult.

Over the period under review Australia took the first place on the list of top barley exporters with current shipments are 16% behind last year pace as the country obtained less barley in 2017.

Russian barley exports have increased, which made the country exporter #2 on the list. Last year this position belonged to Ukraine, which is now the 3rd on the list.

Unexpectedly high exports from the top exporting countries show a stronger demand in the world market, which does not allow prices to fall. In particular, some increase in demand is seen in the countries where imports were expected to decline in the current season. This trend gives reason to assume that at the beginning of season 2018/19, the world barley stocks will be again record low.

Saudi Arabia imports of barley in the current season will be at 8 MMT. However, given quite large purchases at the tenders by Saudi Arabia, over July-February 2017/18, the country imported 10% more barley than over the same period last season.

Market experts continue to raise their estimates of barley imports by China. Over the reporting period China purchased from the major world exporters 17% more barley compared to the same period last season.

In May USDA revised upwards its estimates of Chinese barley imports by 1 MMT against April’s estimates. The 2018/19 season projections were increased to 9.5 MMT. Thus, China will become buyer №1 on the world market ousting Saudi Arabia.  

Full version of the article is available to subscribers for weekly market report “Black Sea Grain” and “Online market review” by UkrAgroConsult.

 

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