First, the supply and demand of wheat are tight.
The global grain market this year is different from last year. The increase in grain prices last year was mainly driven by corn, but this year the situation of corn eased slightly and wheat caught up. At present, the main reason for the global wheat price increase is the reduction of production in major wheat producing countries in the world.
In the first half of the year, wheat was still in full swing and had a bumper harvest. Exporting countries expressed their hope to increase wheat exports to ease the pressure on global food supply, but extreme weather changed this trend.
First of all, the extreme drought in North America has greatly reduced the expected wheat production in the United States and Canada, while Russia has also greatly reduced wheat production because of the weather. In order to give priority to domestic supply, Russia raised the export tariff of wheat. After heavy rain caused floods, many countries in the European Union were also affected, and wheat production declined. For a time, the original harvest of wheat turned into a tight supply. For grain exporting countries, they reduced wheat exports and raised tariffs to give priority to domestic supply, while for grain importing countries, they began to "grab wheat". Not long ago, both Egypt and Saudi Arabia increased their wheat imports.
The situation in South America is also not optimistic. Recently, in order to alleviate the wheat problem, Brazil decided to allow the planting and sales of genetically modified wheat to be promoted nationwide, becoming the second country in the world to approve the commercial planting and sales of genetically modified wheat after Argentina.
Second, corn fluctuated at a high level.
In the first half of the year, the data in the relevant reports in the United States have been favorable for corn, but in the second half of the year, with the increase of corn planting area, yield and inventory expectations, the upward trend of corn gradually eased.
According to the latest monthly supply and demand report of the United States, the corn output in the United States in 20021~ 22 was estimated to be 383 million tons, while the ending inventory was 37.94 million tons, and the yield per mu was raised to 177 bushels, both higher than market expectations.
The report predicts that the global corn inventory will be 304 million tons at the end of the year, which is also higher than previously expected. On the other hand, although corn production has increased, the rising demand for ethanol still supports corn, so corn prices are still fluctuating at a high level.
Third, why did the rice fall?
The situation of rice is not optimistic. While global food prices are rising, the price of rice, the most important staple food in Asia, has fallen sharply. There are two main reasons for the decline:
First, rice production increased. Extreme weather has successively affected corn and wheat, but it has increased rice production. India, the world's largest rice exporter, is expected to produce 654.38+24 million tons of finished rice in 20021~ 22, which is expected to set a world record. However, Thailand, another rice exporter, ended the long-term dry weather due to the increase in rainfall this year, which makes Thailand's rice production expected to increase by more than 20% this year.
Second, changes in the diet structure in Asia have led to a long-term decline in rice consumption.
On the other hand, the increase in fertilizer prices has also put pressure on the grain market. Due to the rising price of fertilizer, the cost of growing corn in the United States has greatly increased, while the cost of fertilizer in Thailand has basically doubled. For Thai rice farmers, the price of a ton of chemical fertilizer is even higher than that of a ton of rice. Therefore, in the international grain market next year, the price of chemical fertilizer will once again contribute to the high shock of international food prices.