The US achieved a season-high for 2014-15 wheat export sales,
led by an order from Brazil – hours after US officials raised expectations for the
South American country's purchases.
The US, which is expected to cede this season to the European
Union the title of the world's top wheat exporter, sold 567,539 tonnes of the
grain for export last week, the US Department of Agriculture said.
The figure was up 58% week on week, and the highest weekly figure yet for sales for
2014-15, for which orders began hitting screens in earnest in January.
It was also well ahead of forecasts of, at best 450,000
And it was led by a sale of 140,000 tonnes to Brazil which -
unlike China, another unusually strong early-season market last year – is
showing relatively brisk orders this time too.
Low tariff window
Indeed, with 2014-15 only one month old, the US has already
sold, or exported, to Brazil more than 900,000 tonnes of wheat, above the
866,000 tonnes at this time last season, and only narrowly behind volumes taken by top buyer Mexico.
Historically, volumes have been far lower, at 50,000 tonnes
a month into 2012-13, and 102,000 tonnes by the end of June 2011.
The sales come during a window, which opened two weeks ago
and lasts until August 15, for which Brazil has scrapped the 10% import tax on
wheat from outside the South American Mercusor trading block.
The move reflected doubts over the ability of Argentina,
Brazil's default origin for wheat imports, to fulfil needs, after a succession
of disappointing harvests, with Brasilia also seen as keen to boost to supplies
to quell food inflation in what is an election year.
'Eating more pasta'
Indeed, the USDA's Brasilia bureau, in a report published
overnight, forecast overall Brazilian wheat imports in 2013-14 – on an
October-to-September basis – at 7.4m tonnes, 100,000 tonnes higher than the
official USDA forecast.
For 2014-15, imports were pegged at 7.0m tonnes, 500,000
tonnes above the USDA's official estimate.
Volumes are being spurred by the country's growing wheat
consumption, which is rising by 2-3% a year, "as consumers in an emerging
middle class are eating more pasta and other wheat-based products", the bureau
For how long?
Besides not producing wheat by quantity to meet its own
needs, Brazil requires higher quality supplies from abroad too, to ensure it
has the flour for its milling needs.
Most of Brazil's imports from the US are of hard red winter
wheat, a higher protein class.
"It is certainly encouraging that Brazil is still coming to
the US for wheat, more than we might have expected," a US grains trader told
"The question is whether it will keep up the pace, whether
it will still be buying when the zero tax window closes."