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Global Grain Geneva diary - day one

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Kazakh crisis?

 

One theme which is running as an undertone at Global Grain Geneva is the performance, or rather underperformance, of the Kazakh grains harvest.

 

The US Department of Agriculture’s Astana bureau last month cautioned over the impact of “hot weather conditions throughout the vegetation season, as well as extensive rains during harvesting time that negatively affected the wheat quantity and quality”.

 

And that has been echoed at the conference, with one Louis Dreyfus trader talking of “really bad” stories over the harvest, adding that the trader was “hearing things we have never heard before”.

 

Swithun Still, director at Swiss-based trader Solaris Commodities, said the he would put Kazakh import prospects at a “lot more” than the 1.5m-tonne number being floated around.

 

Noting the “long and porous” border between Russia and Kazakhstan, a figure of 2.5m tonnes could be in reach.

 

 

Geography test

 

Romania has a few things going against it in attempts to raise grain exports, including its position on the map, with the Carpathian mountains limiting its arable area, for instance, meaning a wheat harvest of some 8.6m tonnes this year.

 

But one thing it does have on its side is time, in that its wheat harvest occurs two-to-three weeks before that in its bigger Black Sea competitors, said Tom Deevy, risk manager at Cerealcom Dolj.

 

That gives Romania an early window to aim at, he said, pegging at some 60% the proportion of Romania’s export programme already typically completed by now, with the season only one-third of the way through.

 

However, with only one port, Constanza, “logistics will always be an issue,” Mr Deevy said.

 

“Getting grain in there at harvest time can be a challenge.”

 

Still, at least Romania’s geography has allowed it membership of the European Union, which could provide a source of funds to improve the country’s grain infrastructure.

 

 

South American corn exports to slow?

 

In corn, however, an autumn-harvested crop, Romania is operating on a different timetable, which will be more late-season weighted.

 

Up to now, Middle Eastern buyers have been able to exercise a “preference for South American corn over Black Sea corn”, Mr Deevy said (if complaining over such discrimination).

 

But Argentine and Brazil are now “almost out of the market” for fresh orders.

 

“After Christmas, we will see a lot of exports” of corn from Romania and neighbours, he said.

 

Will the dismal US 2019-20 corn export season so far see a pick-up too?

 

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