Iran emerges as leading flour exporter

by Morton Sosland
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LONDON — In its quarterly review of global flour exports, the International Grains Council left the total trade outlook in 2014-15 unchanged from the prior season, but revealed that Iran has emerged as a leading flour exporter. The Council disclosed that it expects Iran this season to ship 500,000 tonnes of flour in wheat equivalent, making its outgo match the total from the United Arab Emirates and exceeding U.S. wheat flour exports, placed at 400,000 tonnes, by a wide margin. At the indicated level, Iran exports of wheat flour would account for 4% of the world total.

According to the I.G.C.’s latest forecast, world flour exports in 2014-15 will total 12,480,000 tonnes in wheat equivalent, compared with 12,460,000 in 2013-14 and 12,180,000 in 2012-13. That outgo would be down 14% from the record world wheat flour exports of 14,560,000 tonnes of wheat equivalent in 2011-12.

The current forecast of global flour trade equals close to 200 million cwts of wheat flour, against the record of more than 230 million cwts in 2011-12.

In forecasting Iran’s exports at 500,000 tonnes, or about 8 million cwts, the I.G.C. assumed that the Middle Eastern country’s shipments would be a multiple of the outgo of 38,000 tonnes in the prior season. Iran’s recent peak flour shipments were 93,000 in 2012-13.

The Council said Iranian millers were taking advantage of “attractive profits” from export sales brought about largely by reduced competition from Turkey and Kazakhstan, the two nations that have been the largest flour shippers in recent years. Among the major destinations for Iran flour exports was Iraq, the world’s leading flour importer. Iraq was projected to import 1,450,000 tonnes, up 90,000 from the previous expectation for 2014-15. Those imports were near the same as its takings in 2013-14 when Iraq imported 1,477,000 tonnes.

Other leading flour importers in 2014-15, as indicated by the I.G.C., were Tajikistan, at 1.3 million tonnes, down 100,000 from the previous season, and Afghanistan, at 1.2 million tonnes, against 1,248,000 in 2013-14.

The rotation between Turkey and Kazakhstan as leading world flour exporters continues in 2014-15. Each will account for 20% of global flour exports in the current season. Kazakhstan was shown as nominally in the lead with clearances of 2.5 million tonnes, compared with 2,762,000 in 2013-14 and 2,356,000 in 2012-13. Its flour exports set a global record of 3,652,000 tonnes of wheat equivalent in 2011-12, the equal of nearly 60 million cwts.

The projected Kazakhstan export reduction stemmed from “slow sales to date,” the I.G.C. noted. It added that the country’s “exports are being contained by a smaller harvest and poor quality.”

Turkey’s flour exports in 2014-15 were forecast at 2,450,000 tonnes, down 27% from 3,353,000 in 2014-15. Its outgo in 2012-13 was 2,567,000. In commenting on this cutback, the I.G.C. said, “In addition to problems sourcing good quality grain from traditional origins for local processing, Turkey’s domestic harvest was cut by drought.”

Prospective flour exports from Argentina were cut by 80,000 tonnes and placed at 820,000 tonnes of wheat equivalent, compared with 324,000 in the preceding year and 890,000 in 2012-13. The rebound over 2013-14 stemmed from a recovery in the size of the Argentine wheat crop. Brazil is Argentina’s major flour market, its takings in 2014-15 were forecast at 650,000 tonnes, against 294,000 in 2013-14.

Pakistan’s flour export prospects were at 600,000 tonnes, against 400,000 last year.

Indonesia continued to rank among the major importers, forecast to take 700,000 tonnes of wheat flour equivalent, compared with 311,000 in 2013-14. This sharp rise followed the action of the Indonesian government in cutting import duties from 20% to 5%, as well as briefly opening a tariff-free quota for purchases from major origins, the I.G.C. said.

Angola once again stood as Africa’s largest flour importer, estimated to take 640,000 tonnes in 2014-15, compared with 652,000 in 2013-14.

Exports of wheat flour from the European Union in 2014-15 were forecast at 1.1 million tonnes in wheat equivalent, compared with 920,000 in the previous crop year. Currently shipping less than half of the leading exporting nations, the E.U. for a time ranked No. 1 in flour exporting. It currently accounts for slightly less than 9% of the trade total, contrasted with a peak share near one-third and even 50% for a number of seasons.

United States flour exports in 2014-15 were forecast by the International Grains Council at 400,000 tonnes of wheat equivalent, or about 6 million cwts. At the same time, U.S. flour imports were projected for the current season at 230,000 tonnes, against 256,000 in 2013-14.
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