Argentina wheat exports fail to reach forecast volumes

According to data from Nabsa, an Argentina shipping agency, the country’s wheat shipments during the first month of the 2019/2020 season (December 2019) reached only 1.8 million tons, notably below the Foreign Trade Sworn Declarations (DJVE), which forecast a volume of 3.9 million tonnes.

The low level of the Paraná River made it difficult for ships to load full cargoes at ports in the upriver region of Santa Fe, with many of them sailing below capacity from the terminals. In addition, in the second half of December, there was a combination of fewer working days and persistent rainfall that limited activity at ports.

The expectation of the Rosario Exchange is that shipments scheduled for December but which were not completed will be rescheduled for the coming weeks, thus increasing the need for logistics during these summer holiday period. As a result there is a high volume of shipments scheduled with DJVE for January (2.9 million tons) and February (2.6 million tons).

The following chart, produced by the Rosario Trade Exchange, shows the monthly distribution of Argentine wheat shipments scheduled for the 2019/2020 crop:

Buying Markets

The main buyers were Brazil and Southeast Asia. In the case of Brazil, the Rosario Trade Exchange explained that shipments to the neighboring country had their monthly share increased by 10%, and made up 35% of all December shipments at 630,000 tons.

In turn, Indonesia has again positioned itself as the second buyer with 20% of the total importing almost 370,000 tons. Other Southeast Asian countries also imported a substantial amount of Argentina’s wheat: Bangladesh, Thailand, Vietnam, and Malaysia. As a whole the region imported 35% of the Argentine cereal in December.

Africa, an important market for Argentinean wheat, which has grown considerably in recent seasons, lost market share in December 2019 compared to the same month in 2018. However, the Rosario Trade Exchange highlighted the growth imports from countries in East Africa, such as Djibouti, Madagascar and Uganda, to the detriment of the most common African destinations located in North Africa (Algeria, Morocco) and West Africa (Nigeria). Shipments to the continent in the first month of the 2019/20 season represent 18% of the total, with over 300,000 tons.

The remaining shipments, which amount to over 190,000 tons, were destined to South American countries, like Chile, Peru, Ecuador and Colombia, which accounted for 11% of the total, which is in line with its usual market share.

The chart below, made by the Rosario Stock Exchange, shows the main destinations of Argentine wheat in December 2019:

The following chart, with data from Argentina’s National Institute of Statistics and Census Indec, shows the country’s wheat exports from January 2015 to November 2019:

Graph Source: Indec

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