LONDON — A small upward revision, of only 89,000 tonnes, brought the International Grain Council’s estimate of global trade in wheat flour in the 2007-08 crop year to the largest total in 11 years. Indeed, the revised I.G.C. estimate for the crop year ended June 30 indicated that the season’s global trade in wheat flour was the second largest of record.
Global trade in wheat flour for 2007-08 was placed by the I.G.C. at 10,715,000 tonnes in wheat equivalent. While lagging the all-time record of 11,186,000 tonnes in 1996-97 by 4%, the past season’s total was larger than in any other year.
The revised 2007-08 outgo was up 7% from the exports of 9,976,000 tonnes in wheat equivalent in 2006-07 and showed a minuscule gain over 10,628,000 in 2005-06. In four of the past six years, world flour trade exceeded the 10-million-tonne mark, which represented a sizable gain from the recent low of 8,494,000 tonnes in 2000-01. At the current level, global trade in flour was up 83% from the low point of 5,861,000 tonnes in the last two decades of the 20th century.
Not included in the I.G.C. estimate of wheat flour trade are shipments of durum semolina. The Council placed the durum semolina exports in 2007-08 at 250,000 tonnes in wheat equivalent, which would boost the crop year all-flour total to 10,965,000 tonnes, against 10,284,000 in 2006-07 and 10,951,000 in 2005-06. The record, including semolina, was 11,604,000 in 1995-96.
Commenting on the surge in flour exports, the Council said, "Flour trade has been boosted by tight global milling wheat availabilities and grain export measures taken by several suppliers, including Argentina, Russia and the Ukraine." The measures to which the Council refers were limits on exports of domestic supplies of milling wheat, which favored wheat flour business.
Among flour exporting nations, the major gain over the prior estimate issued in March by the I.G.C. was by Argentina. That country was estimated to have shipped 1,400,000 tonnes of wheat flour in grain equivalent in 2007-08, up 150,000 from the prior figure. The past year’s exports by the South American nation contrast with 972,000 in 2006-07 and 642,000 in 2005-06.
Two importing nations, Brazil and Cuba, accounted mainly for the expansion in Argentine shipments. Brazil, with 2007-08 imports of 1 million tonnes in wheat equivalent, ranked as the world’s leading flour importer in the past crop season. These takings contrast with 663,000 in the prior season and 430,000 in 2005-06, and make Brazil the world’s largest flour market. The Council pointed to the influence of export taxes imposed by the Argentine government, with the current rate on flour at least 10 percentage points less than for wheat.
Imports of wheat flour by Cuba increased in 2007-08 to a three-year high of 270,000 tonnes, compared with 217,000 in the previous season. As recently as 2001-02, Cuba imported 440,000 tonnes of flour in wheat equivalent.
In contrast with the export increase for Argentina, the estimate of European Union flour exports in 2007-08 was cut by the I.G.C., to 1,350,000 tonnes in grain equivalent, or 150,000 less than forecast last March. At the revised total, E.U. flour exports were nearly unchanged from the 2006-07 outgo of 1,314,000 and compared with 1,941,000 in 2005-06 and 2,203,000 in 2004-05. Indeed, the slight gain for E.U. flour exports in the past crop season marked a halt to the dramatic downward trend of the union’s flour exports, which had reached a peak of 6,249,000 tonnes of wheat equivalent in 1996-97. Reductions have occurred in almost every crop year since then.
Commenting on the E.U. export fall, the Grains Council attributed this situation "to reduced purchases by Libya and countries in Sub-Saharan Africa and Pacific Asia and increased competition from other exporters."
For the second successive crop year, Kazakhstan was the export flour leader. Its shipments in 2007-08 were placed by the I.G.C. at 1.9 million tonnes in grain equivalent, down slightly from 2,024,000 in the prior season and well ahead of 1,314,000 shipped in 2005-06.
Russia and the Ukraine, both also members of the Commonwealth of Independent States, were significant exporters. Russia in 2007-08 shipped 550,000 tonnes of wheat flour and the Ukraine 275,000.
The C.I.S. has played an increasingly important role as both flour exporter and importer. The group’s total flour imports for 2007-08 were estimated at 2,140,000 tonnes, up slightly from 2,032,000 in the prior season and compared with 1,522,000 in 2005-06. Limits on wheat exports by exporters spurred business in flour, the I.G.C. said. A major share of exports went to countries in the C.I.S., including Uzbekistan at 900,000 and Tadjikistan at 625,000.
Iraq, which two years ago was the world’s largest flour market, accounted for imports of 600,000 tonnes in 2007-08, against 857,000 in 2006-07 and 1,484,000 in 2005-06. The Council said Iraq’s flour imports were being cut back as domestic mills increased grind of imported wheat.
In fourth place as a flour exporter, behind Kazakhstan, Argentina and the E.U., was Turkey, which not so long ago was the world’s leading flour exporter. Turkey’s exports in 2007-08 were estimated at 1 million tonnes in grain equivalent, little changed from 1,034,000 in 2006-07, but well below 2,250,000 in 2005-06.
Turkey’s main market in recent years had been Iraq, but these sales were being replaced by alternative destinations like Indonesia and Libya, to which shipments have increased sharply. The I.G.C. said that Turkey’s flour business with different destinations would account for 60% of exports, against 30% previously.
Even with government brakes on exports, China’s shipments of flour in 2007-08 climbed 32%, reaching 850,000 tonnes, compared with 645,000 in the preceding year and 487,000 in 2005-06. Brakes included a 25% tax on flour exports.
In face of that situation, the Council said China has become a strong competitor of Australia, causing the latter’s outgo to shrink to 275,000 tonnes, the smallest in five years.
U.S. flour exports rose in 2007-08 to 500,000 tonnes in wheat equivalent, against 416,000 in 2006-07. The gain reflected increased shipments to a number of destinations, the I.G.C. said, mainly citing Canada and Israel.