Oilcrops
International studies forecast for the 2019-20 season point to relatively balanced markets for oilseeds and derived products. After reaching an all-time high in 2018-19, global oilseed production is anticipated to contract for the first time since 2015-16, mostly reflecting expected falls in soybean and rapeseed outputs that would outweigh foreseen gains in other oil crops. Soybean production could decline short of last season’s record level, mainly as a consequence of both a contraction in plantings and lower yields in US, amid unattractive production margins and unfavorable weather situations. Regarding rapeseed, uncertain export prospects contained plantings in Canada, while in the EU and Australia; harvests have been compromised by prolonged dryness. As for palm oil, worldwide production could slow, tied to a deceleration in area expansion and modest yield prospects in Indonesia and Malaysia. On the demand side, worldwide meal utilization is forecast to resume growth, albeit timidly – after being harshly affected by the outbreaks of African Swine Fever (ASF) in 2018-19. Despite the predicted tightening in worldwide carry-over stocks, chief exporters’ stock-to-disappearance ratios still point to a comfortable market condition. International trade in meals and oils is predicted to continue expanding in 2019-20, though at a relatively low rate, underpinned by the predicted slowdowns in worldwide utilization and reductions in exportable supplies. Ongoing trade tensions between individual countries are poised to continue affecting markets for oilcrops and derived products, adding uncertainty to the market outlook. Looking ahead, prices in the coming months will be influenced by weather conditions in South America and Southeast Asia, the evolvement of the ASF epidemic, implementation of domestic biodiesel policies, and trade policy developments.
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Sugar
Furthermore, international sugar markets are seen heading for a modest tightening in the 2019-20 marketing season, as production is forecast to fall below the previous season’s record level while world consumption is expected to expand. As a consequence, sugar inventories are predicted to fall in 2019-20. FAO expects world sugar production to drop in 2019-20 (October/September), declining below total consumption. The forecast for worldwide sugar production in 2019-20 has been revised downwards in recent months and is now pegged at just over 175 million tons, showing a 2.8 percent decline from 2018-19. India, Thailand and Pakistan account for much of the anticipated year-on year contraction in worldwide sugar production. Unfavorable weather situations during sugar cane tillering and elongation stages are largely behind the reduced output. Global sugar consumption is set to expand by 1.4 percent in 2019-20, a modest rise compared with the growth recorded in the previous season, but still below its long-term (10-year) trend, reflecting the growing consumer concerns about excess sugar consumption. Growth in sugar consumption is predicted to be chiefly marked in Africa, the Middle East and Latin America and the Caribbean, driven by growing per capita incomes and lower sugar prices. World sugar trade is predicted to expand in 2019-20, underpinned by a stronger import demand from the traditional sugar importing countries and ample availability in major exporting countries. The introduction of export incentives by some of the major exporting countries is also anticipated to boost global trade in sugar. Exports by Brazil and India are set to rise, prompted by abundant sugar stocks, but to fall in Thailand.
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Meat and meat products
World meat production is forecast at around 335 million tons in 2019 1.0 percent lower than in 2018. This marks a departure from the stable growth trend registered over the past two decades and indicates a sharper fall than anticipated in May, principally because of a deeper than earlier predicted impact of African Swine Fever (ASF) in China and its spread to several East Asian countries. China’s meat output is forecast to decline by 8 percent, offsetting predicted increases in production in various major producing states such as US, Brazil, the European Union and Argentina. The overall fall in China’s meat output reflects a contraction of pig meat output by at least 20 percent, partially offset by higher production of other meats. In the United States, an increase in carcass weights is sustaining growth, whereas in Brazil external demand is encouraging higher production. In the European Union, total meat output is also predicted to expand, albeit slower than predicted earlier because of a likely decline in bovine meat production. Production gains are predicted for all other categories of meat in the European Union, mainly pig meat production, reflecting robust demand from China. Argentina’s meat production is probable to increase, mainly on increased culling. World trade in meat and meat products is forecast at 36.0 million tons during 2019, up 6.7 percent from 2018, principally driven by increased imports by China because of domestic tightness caused by ASF-related production losses. China’s overall meat imports are expected to rise by 35 percent, with increased purchases across all meat categories. By contrast, various states are expected to import less meat, counting the United States and Angola.