December 18, 2007

 

World 2007/08 grain will need extra 10 panamax vessels

 

 

World grain trade is expected to absorb an additional 10 panamax vessels in the 2007/2008 season, after global forecasts for grain exports were revised upwards.

 

As of November, the International Grains Council(IGC) said global grain trade, which includes wheat and coarse grains, had increased due to accelerated purchases by the near east, particularly Saudi Arabia, and a strong pace of EU imports from Brazil.

 

The IGC projects Brazil's exports for the current season was at a record 9.5 million tonnes while an additional 21 panamax ships, on the basis of carrying 55,000- tonne cargoes, will be required to carry the additional grain to the EU.

 

It added that despite a fall in Asian demand for panamax grain shipments, the overall net result would be an extra 10 ships being employed in 2007/2008.

 

Overal, the IGC has raised its forecast for global grain trade to a record 225.4 million tonnes in 2007/2008, up 1.4 percent on-year due to volumes of corn being exported.

 

The IGC added that global trade in corn was expected to increase to 94.7 million tonnes, up 8.4 percent on-year.

 

Corn imports into the EU-27 and the near east are expected to increase to 8.5 million tonnes, up 63.5 percent on-year, and 10.6 million tonnes, up 15.2 percent year-on-year respectively.

 

The EU has been forced to more than double its grain imports for the current season as a result of low levels of domestic production.

 

A UK-based grain trader told Lloyd's List that the volume of feed grain grown in the EU has been too low this year.

 

The trader added that also, the quality of milling wheat was extremely low, which has triggered the increase in imports into the EU.

 

Total crop imports into the EU, which include both wheat and coarse grain, are expected to increase to 18.7 million tonnes in 2007/2008, up 60 percent compared to the previous season.

 

The brokerage added that total crop imports into the Middle East are expected to rise by 4 percent to 31 million tonnes in the same period.

 

Meanwhile, the US Department of Agriculture has raised its US corn export forecasts for the 2007/2008 season to a record 62 million tonnes due to strong overseas demand and a lack of competition.

 

This represents an increase of nearly 8 million tonnes compared to the 2006/2007 total.