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Prospects mixed for former Soviet Union winter wheat sowings for 2020 - UN

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The United Nations noted a mixed picture for former Soviet Union winter wheat sowings, currently in progress, but flagged decent prospects for corn being seeded in Brazil and South Africa.

 

The UN food agency, the Food and Agriculture Organization - in initial comments on northern hemisphere winter wheat being seeded for harvest in 2020 – said that in Ukraine “dry weather conditions have curtailed planting expectations”.

 

Ukraine farmers had as of the end of last month seeded 3.52m hectares of their winter grains for the 2020 harvest, equivalent to 48% of expected area, according to the country’s agriculture ministry, but 1m tonnes behind the year-ago pace.

 

The area comprised d 3.23m hectares of winter wheat, 212,000 hectares of winter barley and 78,000 hectares of winter rye.

 

A year ago, growers had seeded 4.54m hectares, 63% of the forecast total of 7.2m hectares, comprising 4.18m hectares of winter wheat, 275,000 hectares of winter barley and 88,000 hectares of winter rye.

 

‘Area expansion’

For Russia, the sowings pace for winter grains – of which wheat here also accounts for the vast majority - has, after a rapid start, slipped behind the year-ago rate too, amid concerns over dryness in the South.

 

As of September 26, farmers had planted 11.6m hectares of winter crops, compared with 12.4m hectares at that stage of 2018, according to SovEcon.

 

Nonetheless, the FAO said that in Russia, “early indications point to an area expansion, which would support the short-term trend underpinned by government policies that seek to boost exports”.

 

The agency did not comment on winter wheat plantings elsewhere, including those in the European Union, the top producer, or the US.

 

Corn vs soybeans

For the southern hemisphere, the agency flagged “most favourable” for the sowings of first crop corn for harvesting early in 2020, saying that these conditions “and an increase in the minimum producer price for maize, set by the government, could prompt an area expansion”.

 

Although the country’s soybean sowings, centred further west, have been dogged by dryness, first crop corn-growing regions have received better rainfall.

 

Separately, respected analyst Dr Michael Cordonnier said that “the weather for full-season corn planting has been better than for soybeans because nearly all of the full-season corn is planted in southern and south eastern Brazil,” in states such as Minas Gerais and Rio Grande do Sul.

 

“Southern Brazil has received some showers and the forecast is calling for more rain over the next 1-2 weeks.”

 

‘Increased momentum’

The FAO also noted that “in South Africa, higher year-on-year prices and tighter domestic supplies could instigate an increase in the sown area and result in a production rebound in 2020” from the drought-hit crop harvested early in 2019.

 

The comments - which tally with a US Department of Agriculture forecast for South African corn output rebounding by 2.5m tonnes to 14.0m tonnes - come as growers in eastern areas “have started with soil preparations”, according to Wandile Sihlobo at industry group AgBiz.

 

“We expect to see increased momentum in plantings after the first rains, which will most likely commence at the end of October into November, according to estimates from the South Africa Weather Service,” Mr Sihlobo said.

 

He has backed the potential for a recovery in South African corn output for the next harvest, which counts as 2019-20, saying that assuming a return to more favourable weather yields will improve, and “the hectares that went unplanted in the 2018-19 season are likely to come into production”.

 

Harvest downgrade

The FAO’s comment came as it trimmed by 2.2m tonnes to 2.706bn tonnes its forecast for world grains output in 2019-20, although this would still represent a record high.

 

The downgrade reflected reduced expectations for Australia’s drought-pressed wheat crop, and for rice output in India, where “a series of weather setbacks caused planting delays”.

 

The revisions more than offset an upgrade of 2.5m tonnes to 1.427bn tonnes in the estimate for world production of coarse grains, such as barley, corn and sorghum.

 

The FAO noted “larger-than-expected plantings” of corn in the US, and an upgrade too to Brazil’s nearly-completed second, or safrinha, crop harvest – which the agency, unlike many other commentators, counts in new-season figures.

 

The USDA, for instance, and Brazil’s Conab count the ongoing safrinha harvest as 2018-19 crop.

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