WORLD SUPPLY AND DEMAND FOR GRAIN 1974/75 (WITH EMPHASIS ON FOREIGN DEMAND FOR US WHEAT AND CORN)

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T00875R001900030195-0
• Release Decision: RIPPUB
• Original Classification: C
• Document Page Count: 77
• Document Creation Date: December 21, 2016
• Document Release Date: November 7, 2008
• Sequence Number: 195
• Publication Date: December 9, 1974
• Content Type: REPORT

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a.Vrvl I1J7ti4I II L.
WORLD SUPPLY AND DEMAND FOR GRAIN, 1974/75
(WITH EMPHASIS ON FOREIGN DEMAND FOR US WHEAT AND CORN)
On file
Department of
N Agriculture
release
instructions apply.
OFFICE OF ECONOMIC RESEARCH
CENTRAL INTELLIGENCE AGENCY
9 DECEMBER 1974
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CONflr rITIP.L 25X1
WORLD SUPPLY AND DEMAND FOR CORN, 1974/75
Introduction
This u?daces our 23 September report on alternative
estimates of world export supply and demand for grain (excluding
rice). It compares CIA estimates with those of USDA* and,
for wheat, with the International Wheat Council. The analysis
is aimed at determining the foreign import demand for US wheat
and corn in the 1975 marketing year (MY).**
A forecast of the 1974/75 world grain supply/demand still
must be very tentative. Supply and export availability
estimates include forecasts of coarse grain not yet planted and
wheat harvests not completed in the Southern Hemisphere, and
final results yet to be published on coarse grain output in
the Northern Hemisphere. Demand analysis is hindered by limited
knowledge on the full impact of sharp price rises on utilization
of grain for feed both here and abroad. Also, there is an
incomplete understanding of how worldwide inflation is affecting
effective demand.
Appendix A provides a discussion on the grain situation
in individual countries.
All references to USDA estimates in this report refer to
those contained in the Foreign Agriculture circular FG23-14,
7 November 1974 and supplemental information.
** The marketing year for wheat is 1 July-30 June and for corn,
1 0.:tober-30 September.
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Principal Pindin s
The 1974/75 world grain situation has tightened over
the past 2 months. Total grain production (excluding rice)
has dropped another 17.5 million tons, largely feed grains,
to 911 million tons.* Thus, a 6% decline in output is now
forecast rather than the increase projected in early summer.
Most of the recent deduction comes from short corn harvests
in the US, Western Europe and the USSR. Wheat production shows
only minor changes, but the quality of the grain harvested in
Canada a0d Western Europe is below a year ago.
Grain consumption will be down less than production
leading to a further drawdown in ending stocks. USDA estimates,
and we agree, that ending stocks will fall by 20 million tons.
Most of the reduction will occur in US and USSR holdings.
Similarly, the US will account for a larger share.of the
decline in consumption than the rest of the world; estimated
for the US at 16% for feedgrain and 4.5% for wheat.
CIA agrees with USDA's forecast that the world import
demand for wheat is now 64 million tons (excluding antra
EC-9 trade). Uncertainties about India and Middle East
*Metric tons are used throughout this report.
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intentions could push demand higher. The International
Wheat Council places wheat import requirements 2 million
tons higher. We estimate maximum export availability of
wheat at 64.4 million tons by drawing down Canadian and
US stocks. The tight supply/demand balance portends further
upward pressure on wheat prices in the coming weeks.
CIA estimates total foreign demand for US wheat and flour
in FY 75 at last year's level of 31 million tons (1139 million
bushels), 2.4 million tons higher than USDA. This level of
export would reduce US ending stocks to a new low of under
5 million tons (179 million bushels). Canadian shipping problems
and likely higher import demand by India could put additional
pressure on US wheat supplies by January.
The 1974/75 supply situation for corn is tighter than
for wheat. Additional cuts last month in US corn production
estimates -- the world's largest producer and exporter -- are
directly reflected in a 17% drop in total export availabilities
from MY 1974 to 36.6 million tons. This is a maximum level
and implies a drawdown in US stocks by 30 September 1975 to
only a 3 1/2 week supply. CIA agrees with USDA that foreign
demand for corn will be down but projects less of a reduction.
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CO,:, 107'1TI:1 L
Our import demand estimates closely approximate the export
availability of 36.7 million tons. Excess demand, however,
will occur if the EC does not hold total corn imports to no
more than 9.6 million tons or the Soviet Union makes additional
purchases.
CIA estimates that export demand for US corn in MY 75
will be 23.5 million tons (925 million bushels). This compares
with USDA's projection of 22.9 million tons (900 million bushels)
CIA's higher level of export could be met only if domestic
consumption falls lower than now projected by USDA. A further
drawdown in stocks is not considered feasible.
Domestic use and import demand estimates are still
uncertain due to uncertainties about adjustments that are
being made in livestock feeding in both the US and abroad --
especially the EC -- because of (1) higher feed prices, (2)
impact of economic slowdown on consumer expenditures, and
(3) government actions that might be taken to protect national
livestock industries.
US export shipments of both wheat and corn have moved
at a slower rate so far this marketing year than a year ago.
Activity has picked up in the past month. For the 3 week
period ending 29 Nov;mber, inspections of grain for export moved
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At an annual rate for both wheat And corn that exceeded
USDA and CIA projections tor MY 75 (see ChartsI. This
shipping information is only an indicator and does not in
itself imply a larger export demand than now projected.
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V 'I!E1\ T Vv' EE1"IIV i.XP31 ]T Slti 1"I V f ,Psi ` i1U10
Thee ? week moving average of inspections for export, converted. to annual rate.
f.itl. BU.
LEI I I I i I ~ i i? I J
JAN. FEB. MAR. APR MAY JUNE
? +t. R'
C 0 ii i ~'6.1: J f.
~j Ia {J
Three ? creek rloviag average of inspections for export, converted to annual rate.
16 0 0j- -
.1
"913/74 V 0
V;*. 1974/75
AUG. SEPT. OCT. NOV. DEC.
loo- .?
197
..~
3/14
1200 --
1000 y~ I CIA
000.1 I _
600 1914/75
A
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WHEAT: SuP.iLY/DEMAND SITUATION 1974/1975
World Production of Wheat, 1974/75
1. World wheat production, according to recent USDA
estimates, is expected to fall 15 million tons short of last,
year's record output of 367 million tons. An International
Wheat Council (IWC) press release on 26 November also gave a
production forecast that ranged from 15-17 million tons below
1973/74. CIA considers both of these estimates to be on the
high side -- partly based on more recent information -- and
has reduced USDA's projection by about 5 million tons to 346
million tons, 21 million tons or 6% below last year (Table 1).
2. Important differences in production forecasts for
major exporting countries are those for Canada, Argentina and
the USSR. We have estimated the impact of unfavorable weather
on wheat yields to-be mcr,- serious in the USSR and Argentina
.than USDA. For the USSR, the
CIA estimate is 5 million tons lower than USDA's 90 million tons.
In Argentina, drought damage has lower :d earlier wheat estimates
by .7 million tons, and the final estimate could be even lower.
On the other hand, frost damage to the Canadian wheat crop was less
than expected. The quality of the crop is the worst in years,
however, with nearly 30% of the crop -- usually 1% -- classified
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Table 1
World Wheat P.Produiction/
(In Million Metric Tons)
Country or
Projection
Region
'
1'97'4-75
1973-74
-/
CIA
USDA
Argentina
6.7
5.8
6.5
Australia
12.0
11.4
11.0
Canada
16. 5
14.2
13.4
East Europe
31.6
33.4
33.9
India
24.9
22.1
22.5
West Europe
50.7
55.3!/
55.3
USSR
109.7
85.0
90.0
USA
46.6
48.5!/
48.5
Other
68.3
70.6b/
70.6
TOTAL
367.0
346.3
351*.6
Production data include all harvestings occuring in the July-June
year shown.
No Lidependent estimates made, accepted those of USDA.
Estimates as of 31 October 1974, Wheat Situation, ERS/USDA,
November 1974.
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as feed quality. Reports from both East and West Europe
indicate that wheat harvest results were better than expected
2 months ago. Nevertheless, the protein ccntent of wheat
throughout Europe iv.: lower than last year raising import
requirements for hard wheats.
Export Availabilities
3. The estimated availability of wheat for export
in FY 75 has increased by about 5 million tons since September.
This resulted from a larger than expected harvest in Western
Europe and by additional drawdowns in US and Canadian stock's.
There is agreement between CIA, USDA, and the IWC estimates
that export supplies could exceed the 62 million tons traded
in FY 74. We forecast a maximum export availability of 64.4
million tons as compared with 65.6 million tons by USDA and
68.1 million tons by the IWC (see Table 2). The IWC projection
c,i 14.6 million tons for Canada is unrealistic. Transportation
problems have already slowed wheat shipments behind a year ago
c-o that Canada will have difficulty moving as much as
10.5'to 11.0 million tons in FY 75.
4. Australia, Argentina, -.nd the EC all have exportable
surpluses larger than in FY 74. Both Argentine and Australian
shipments, however, will. be limited to the amounts shown
on Table 2 by transport constraints rather than supply. This
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World Expor. is of Wheat and Flour
' ' . . ' ' ' Million Metric Tons
P
N
Estimates as of 1 November 1974.
Estimates reI ased 25 November 1974.
High end of range used
Based on reducing end-of-year carryover grain the current USDA
estimate of 7.3 million tons to 4.8 million tons. This level
is considered the minimum without disrupting orderly marketing
of wheat.
Availabilities FY 75h/
Country
FY 73
FY 74
CIA USD1.5
Argentina
3.5
1.1
2.2
2.7
2.5
Australia
5.5
5.5
8.6
9.0
8.5
Canada
15.6
11.7
11.0
10.5
14.6E/
West Europe
7.3
5.8
6.8
7.5
6.0
USSR
1.3
5.0
3.3
4.5
4.0
US
32.0
31.1
31.0-/
29.9/
31.0c-/
Other
2.7
1.6
1.5
1.5
1.5
TOTAL
67.9
61.8
64.4
65.6
68.1
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could change for Argentina if drought damage to the December
wheat harvcjt proves as bad as some early reports, The CIA
and IWC estimates of US export availability at 31 million tons
will require a. drawdown in stocks to a historical low of
4.8 million tons (178 million bushels).
5. Three major sources of uncertainy that could reduce
the wheat export supply estimates -- other than the transport
problem -- are (1) whether the Canadian Government or wheat
board authorize at least a 2 million ton dLpw down in stocks
for export, (2) whether more wheat than now estimated will
be used to feed livestock in the EC, and (3) whether the
US domestic consumption of wheat is as low as the 713 million
bushels now projected by USDA.
World Import Demand for Wheat, FY 75
CIA agrees with USDA forecasts *that total world
import demand for wheat is about 64 million tons (excluding
intra EC-9 trade). This represents an increase from September
forecasts of 5 million tons for USDA and 3 million tons for Cu..
7Import demand estimates have been revised upward due to
revised sizeable actual expected purchases of Wheat in the
past month by the USSR, South Asia, and Africa.
The needs of South Asian countries, especially India, are not
fully reflected in these estimates. IWC estimates imports
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for this region at about 2 million ton:; higher than CIA.
Should financial aid become available to these countries,
'an additional import of 2 million tons would be realistic.
Our estimates of 'demand are based on current aid programs
plus the ability of the country to purchase;in commercial
markets.
7. Compared to a year ago, the largest increase in import
demand is nearly 6 million tons for the Asian region. This
reflects the shortfall in grain output for India and Bangladesh, and"
affluence of the Middle East region. Better harvests and/or
drawdown of stocks will reduce the import requirements of
Western 'Curope, the USSR, and South America.
S. Projections of FY 75 import demand for wheat continue
to be uncertain due to factors difficult to analyze. These
include:
?Unknown influence of high feed grain prices on use of
wheat for feeding livestock;
?Whether India may divert more foreign exchange or
receive more financial aid for grain purchases than
now forecast; and
?Stockpiling policies of certain Middle East countries.
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Fore ijn Demand for US Whoa t-
9. CIA forecasts FY 75 export demand for US wheat
and flour at 31 million tons (1,139 million bushels), 2.4
million tons above USDA's forecast of 28.G million tons
(1,050 million bushels)*. This compares with exports of
31.1 million tons last year (see Table 3). Our predicted
demand for US wheat exports has risen 3 million tons since
September. Major upward adjustments were made in sales to
the USSR, Inaia, and Iran, whichmore than offset the 1.3
million tons cancelled by the PRC.
10. CIA estimates by region and selected countries
are compared to those of USDA and to shipments plus outstanding
export contracts (SOES) as reported by grain brokers to USDA
in Table 3. Unlike the situation at this time a year ago when
the SOES exceeded the projected exports for the entire year,
on 17 November 1974 it represented 88% of projected exports
for the year. Only for the European area does the SOES exceed
USDA or CIA estimates. Based on last year's experience, some
of these contracts -- largely those between US brokers and
West European subsidaries -- will not be fulfilled.
*Mid-point- oe USDA's projected range of 1,000-1,100 million
bushels.
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Dentinntion
0 inr,tnnL
TABLE
EST' '1ATED DEMAND FOR US WHEAT AND
FLOUR EXPORTS, FY 75
ON THOUSAND fETRIC Torts)
Forecast FY 75b, sots /
FY 74 CIA USDA- 17 November 1.974
Western Ileminphore:
kuwilo 7D4 850
11=2 t 1 ? .. 3.550 980
Chile 600 700
Colombia 472 320
Peru 490 700
Venezuela 607 540
Central America 299 335
Others 145 630 m
Sub-total 5, ,
USSR
Eastern Europe
European
Community
Other West
Europe
Sub-total
2,725 1,340
851 800
2.477 2,665
693
X4 6
535
5,_4
Asia:
Japan 3,067 3,200
India 1,620 4,000
Taiwan 849 590
People's Republic
of China 3,190 1,700
Korea, South 1,588 1,700
Iraq 459 ? 445
..Iran 584 1,900
Israel 449 300
Philippines 385 480
Bangladesh 730 700
Indonesia 315 30
Pakistan 544 550
South Vietnam 119 100
Turkey 329 750
Other 834 985
Sub-total 1370" 1773-0
850
762
1,100
323
500
201
340
161
600
243
500
319
1,060
205
667
,
,
1,300
1,154
700
625
2,500
3,910
300
106
4,,800
5,795
3,100
2,157
2,800
2,914
500
236
1,750
1,750
1,368
557
1,695
269
7,600
324
(700)
319
109
(450)
314
0
942
437
15
1 TIMIT
Africa:
Algeria 1,046 1,000 275
Egypt 713 1,000 296
Morocco 599 400 487
Nigeria 368 270 165
Sudan 1 656 170 59
OL 'rs 335 155
Sub-total 3,175 1 437
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Cuu; lnccmnt
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ILLEGIB
Total Wheat
TAIL[ 3 - c.QN,_'I
Forecnnt MY 75 SOTS,
MY 74 CIA . UAY 17 Novembor 1974
Flour and Products d 800
Total Wheat and
Flour 31,067 31,000 28,590 23,504
Unspecified
Destination --- ---
Total Wheat (known
and unspecified
destination)
a Marketing year, 1 July 1974 through 30 June 1975
Statistical data shown were supplied by FAS/USDA on 25 November 1974.
EC/ Wheat Shipments inspected for export 1 July 1974 through 25 October
1974 plus Outstanding Export sales as of 27 October for the balanci
of FYP1975
Flour in grain equivalent included with individual country's wheat
import projections in grain equivalent.
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11, The smaller amount of US wheat on export contracts
so far this year probably reflects less panic buying, delayed
purchases in hopes of lower prices, and commercial market
participants approaching the market in a more orderly fashion.
US sales can be expected to pick up substantially during the
next 2 months for the following reasons:
?Major importers such as Japan and India are not
covered;
Some switching from Canadian to US wheat because of
quality problems, especially for Canadian durum;
?Deterioration of grain export prospects for Argentina;
?Transport or labor problems expected to constrain
Canadian rovem- nt of wheat.
12. The major difference, between USDA and CIA export
forecasts are in Asia and to a lesser extent Western Europe.
The difference on Mrica is less than 100,000 tons if you
add the 800,000 tons of flour export to USDA's estimate.
Flour is included in the CIA country estimates but not USDA's.
The major difference in Asia is centered on India. We estimate
India's imports at 4 million tons -- a minimum -- or 1.2 million
tons more than shown by USDA. Known purchases plus announced
PL-480 commitments already total over 3.5 million tons. USDA
officials privately agree that the final figure may be raised
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to 4 million tons. For Europe, c:e cst,,Utated that the EC
import demand will be up slightly from FY 74 to compensate
for a poorer quality wheat harvest and to reflect some shi':t
from Canadian to more, US durum wheat.
13. The US can export 31 million tons of wheat this
year by a drawdown in carryover stocks for the third
successive year. Given this level of export and accepting
USDA's Outlook Board projection of 19.4 million tons
(7.3 million bushels)* for domestic consumption, carryover
stocks on 30 June 1975 would be down to a historical low
of 4.9 million tons (179 million bushels). USDA's smaller
level of export would permit a small increase (19 million
bushels) in carryover stocks.
14.. It should be pointed out, that total US inspections
of wheat for export in the 1 July-22 November period were
running 4.6 million tons behind a year ago. These data imply
an annual rate of export of 28.3 million tons of wheat
(excluding flour) or approximately the same as USDA's current
*Mid-pointt of USDA estimate.
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projection. During the post 3 weeks, however, inspections
for export have increased and are running at an annual rate
of over 30 million tons. We believe that wheat shipments
will continue to pick up in the coming months, with larger
movements to the USSR, Middle East and South Asian countries.
An even larger bulge could occur in shipping after 1 January
if the Canadian longshoremen go on strike as some predict.
CORN: SUPPLY/DEMAND SITUATION 1974/75
15. The world supply/demand situation for feedgrains
in 1974/75 has tightened further in the last month. While
sluggish economic conditions have brought some relief on
the demand side through the declining demand for meat, supply
conditions have further deteriorated Ln recent weeks. The
November production estimates for the US indicate an additional
decline of 17.5 million tons in feedgrain production frcn a
month earlier. Crop damage from dry weather in the USSR and
Eastern Europe has also taken place, resulting in decreases
of 2 and 4%, respectively, in feedgrain production -- largely
corn -- from last year. A good Southern Hemisphere corn crop
earlier this year has helped ease the supply situation but
transport problems in Argentina and South Africa still cloud
the export picture.
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C()I:r1 T
Wor. i.d Production of Corn, 1974 75
16. World production of ,fecdgrains in 19?4/75 is now
projected to be down by over 6 percent -- to 564 million
metric tons in 1974/75 compared to 603 million tons in 1973/74.
Had world production lived up to March expectations, there
would have been a 15 million ton increase in world feedgrain
production rather than a 39 million ton decrease. Amost 34
million tons of the decrease from last year is in the US alone.
World production of corn has declined similarly, with production
of the major exporters down by 120u- to 141 million tons in 1974/75.
.Although production in Argentina, South Africa, and Thailand
is estimated to be up by nearly 7 million tons, it was not
enough to offset a 26 million ton shortfall in the US corn crop.
Production in the EC is estimated at 14.6 million tons, a 9%
drop from 1973. USSR output also declined by about 2 million
tons or 15J below last year.
Table 4
Estimated Corn Production of Major Exporters
(million met
ric tons)
Exporter
1973Z74
1974/75
US
143.3
117.4
Argentina
9.9.
10.0
South Africa
11.0
Thailand
2.3
140.7
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tCp; ;r-jr ?ITIAI!
Export Avail.abili..i05
17. Corn export availability will be sharply limited
in MY 19752'bythe production shortfall because stocks are at
the lowest level in 20 years. The total export availability
of the four major exporters is down by 4.5 million tons (see
Table 5). While corn exports of non-US supplies should be up
by almost 3 million tons barring further tran:.port difficulties,
those of the US will be down by nearly 8 million tons. Another
1.6 million tons should be available for export from the EC
Brazil, anO. Indoensia-- 230,000 tons more than last year--
raising maximum total export availability to 36.6 million tons.
Table 5
Corn Exports of Major Exporters
(million metric tons)
Exporter
MY 74
Forec?.dt MY 75
US
31.5
23.5*
Argentina
2
5.7
South Africa
1.2
3.9
Thailand
2.0
1.9
Total
39.1
35.0
*This represents an export availability assuming USDA's lowest
estimate of domestic use and ending stocks; the ending stocks
figures of 2G5 million bushels is 3.5 weeks domestic supply and
represents the lowest level to which stocks could be drawn wit.houL
seriously disrupting the domestic market.
a/ The Marketing year. (MY) for corn is 1 Octcbcr-30 September,
unless otherwise noted.
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H A N A N IIAL
World Import Demand for Corn
18. Worldwide import demand for corn in MY 75 is
estimated at 36.7 million metric tons -- a 17% drop from
last year. The Lower import demand is due mostly to dcp,:euscd
livestock markets and high grain, prices. Livestock producers
in Europe -- largely the EC -- are expected to feed about 20
less grain livestock.because of the unfavorable ratio of
feedgrain Prices to livestock prices. A good wheat crop
will permit the EC to feed over 2 million tons more of soft
wheat than last year and to cut corn imports by 1.8 million tons.
The USSR, contrary to earlier expectations, has entered the
corn m;.;rket for over 2.2 million tons so far this year. On
the other hand, the ?RC is expected to cut corn imports --
used for human consumption -- by more than 1 million tons due
to a good grain crop this year.
19. Importing countries are not actively pursuing policies
designed to decrease feedgrain usage, so the decrease in overall
import demand is due solely to market forces. The USSR is
adhering to its goal of producing more meat to upgrade Soviet
diets. Japan is supporting domestic livestock prices via meat
import restrictions, thus shoring up the demand for imported
feedgrains. The EC is protecting its domestic livestock
industry by both limiting meat iciports and supporting domestic
livestock prices. The largest decrease in corn or feedgrain
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C(7^~f I;,r':r:t1. 25X1
usage'secri,?; to be occuring in the US -- currently forecast
by USDA at 17% -- where the relatively unprotected livestock
industry is badly lepr.esscd with no immediate relief in
sight. In Europe and Japan, the total grain fed to livestock
and in turn import requirements could still fall below current
forecasts if grain prices strengthen and those for livestock
products weaken further.
Foreign Demand for US Corn
20. CIA estimates foreign demand for US corn in MY 75
at 23.5 million tons -- 600,000 tons above USDA's November
estimate of 22.9 million tons.* Shipments plus rtitstanding
export sales (SOES) and 17 November already totaled 31.9
million tons, more than the US, exported in MY 74. A comparison
of CIA and USDA estimates are shown in Table 6. Major
differences in estimates are centered in Europe and Asia.
21. CIA estimates the EC total import needs from third
countries at 9.6 million tons of corn -- a drop of almost
16% from the 11.4 million tons imported last year. We estimate
that the EC will receive 1.6 million tons of corn from Argentina
and 1.0 million tons from South Africa, leaving 7.0 million
tons of corn to be obtained from the US or 29% less than the
9.9 million tons last year. USDA also estimates EC imports of
US corn at 7.0 million tons. However, both of these estimates
*This is the mid-point of USDA's estimate range of 22.3-23.5
million tons.
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TABLE G
DEMAND FOR U.S. CORN EXPORTS,
MARKETING YEARS J 1974 AND 1975
SIn Thousand Metric Tons)
Forecast MY 75 SOESE/
Destination MY 74 CIA USDAW 17 November 1974
Western Hemisphere:
Mexico
1,194
650 --
-
387
Canada
813
600 --
-
647
Other
795
825 --
-
466
Sub-total
2,80$
2,075 1,90
0
b
Europe:
US
SR
3,016
1,100 1,10
0
1,092
Ea
stern Europe
908
2,400 2,15
0
2,216
East Germany
152
(1,000) --
-
(709)
Poland
483
(1,000) --
-
(1003)
Other
273
(400) --
-
(504)
Eu
ropean Community
3,854
7,000 7,00
0
14,102
Ot
her West Europe
3,986
3,225 2,10
0
2,131
Greece
---
(250) (10
0)
(346)
Spain
--
-
(1,800) (1,80
0)
(1,2461
Other
--
-
(1 175 (20
0)
(53':
Sub-total l
~
13,725 12,35
0
1 ,54'
Japan
6,38
2
6,100 7,00
0
6,762
Taiwan
30
5
200
0
23
People's Republic of
China
1,46
5
50
0
0
South Korea
38
1
490 1. 1,10
0
559
Other
46
3
535
(
373
Sub-total
8,99
6
_
7,375 8,10
0
7,717
73
4
335 13
0
Total corn 3
1,17
8
23 510 22,48
0
28,911
Products
40
6
J 38
1
---
Total corn and
products 3
1,58
4
23,510 22,86
1
28,911
Unspecified
destination
3,034e/
Total
31,945
iba/
d/
1 October through 30 September of year shown.
Provided by FAS, USDA: numbers are approximate.
Corn shipments inspected for export 1 October 1974 through 1974 plus
outstanding export sales as of 17 November 1974 for the balance of the
1975 marketing year. Data compiled from USDA, SRS, Grain Market News
and from USDA, FAS, Exports.
Products included with individual countries' corn import estimates.
Includes 90,000 tons of unsold corn shipped abroad on broker's ac..:ounts.
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are based in part on the, EC Commission's import estimates
and informal commitments to attempt to hold US corn imports
from the US to this level.* The EC as of 17 November had
already contracted for 14.1 million tons of US corn in MY 74
according to US exporters. However, past experience indicates
that (1) all of this will not necessarily be delivered
(contracts can be cancelled), (2) corn from other countries
may be used to fulfill the contracts, (::) part of the grain
will be transhipped to other European countries.
22. Total corn import demand for "other West Europe"
is estimated at 5.1 million tons with the US share at 3.2
million tons cot::iared to the USDA estimate of 2.1 million tons.
Since USDA has not provided a complete country breakdown for
the region we are unable to pinpoint the discrepancy. Total
requirements for Eastern Europe are estimates at 2.8 million
tons with 2.4 million tons from the US. USDA places US corn
exports to Eastern Europe at 2.2 million tons. While the?SOES
for Eastern Europe and other West Europe combined are lower than
our estimates, we believe that transhipments from the EC to both
regions will make up the discrepancy.
23. The difference between CIA and USDA estimates for Asia
center on Japan with our estimates being about 900,000 tons
lower. With Japan's total corn import requirements estimated
25X1
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at 8.2 million tons and with arrar-ged imports of 1.0
million tons from Thailand and 1.1 million from South Africa,
we agree with the US Agricultural Attache that Japan will
need only 6.1 million ton;; fromthe US. SOES to Japan were
about 6.7 million on 17 November but we except Japan to
cancel some contracts as they did last year.
24. The estimates of both world import demand and US
export demand are indicators of market pressures rather than
estimates of final exports. Using our estimate of US corn
export demand and USDA's latest estimates of domestic
production and usage, US stocks as of 30 September 75 would
be drawn down to 5.9 million tons, equivalent to about 3 weeks
domestic use. Since ending stocks on the order of 6.7 million
tons is the minimum required to ensure orderly marketing, US
corn exports of 23.5 million tons are not feasible unless dormest_ic
use falls below USDA's estimate. Consequently, some additional
upward price pressure is indicated unless there are decreases
in demand which are not apparent now.
25. Corn moving out of the country began slowly this
marketing year, but has picked up in the last few weeks.
US corn exports in the 1 October-29 November period were
1.1 million tons less than in the same period last year. Whil::
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thi;u ln%pl.icL an annum rate of export only 22.0 mil.l.ion
ton:;, sliyhLly 1csS than t1SDn';; estimate, the last 3 wee}::;
rate of export: .i.mpl.i.c, an annual rate of 28.5 million
tons. This rate exceed; both USDA and CIA export projections
for MY 1975.
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APPE14D IX A
SITUATION IN SELECTED COUNTRIES
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MTEFJ.Lci
APAN .............
MALAYSIA .........................................
AKI STAN
EOPLES I~EPUB I C OF ~H I N
. . . . . . . . . . . . . . . . . - . , . . . . . . , , , . . , . . . . . . , , . 1 6
NDONESIA
.........................................................RAN ... .. . ................... 19
RAQ
.
. . . . . . . I . I I . I I I I I 1 . , , , . . . , . . a . . . . . . . . . . . , 2
PERU...........................................12
VENEZUELA ..................... ..
. ..................13
As
ANGLADESH . . . . . . . .
AMBODIA
OL0t113IA..................... EXICO
MA.J Q R_-f_); (_OI;IERS
ARGENTINA ..........................................
Au$TRALI1...............
ANADA
OUTII AFRlcn .......................................b
WESTERS1 ~.;RCPE AN'n THE EC 7
C AJQ[3_._II'1-TRT_E S
WE TERN HEMISPHERE ................................. 0
/R A Z I L . . . . . II . . . . .. . . . . . 11111911111114 . . . . . . . . . 1 C.
HILE
PHILIPPINES ......................................26
AUDI RABIA ....................................
OUTH IOREA ......................................./
SOUTH VIETNAM ....................................29
SRI LANKA ........................................3(1
TAI4IAPI .................................irr..,....31
HA ILAI:D,,,,...,,, J2
EU 9OPE ............................................. Ll
ASTERN EUROPE .......... ::~4
USSR, . I S S S S I . . . . . . . . so . . . . . . . . . . . . . . . . . . . . . . . . . 0036
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CC, "*: 1)r 141 I'll
E9NIL-trS-_c-(-Ii T
O.
`A, . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . .. . . . g
G Y P . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0R000O .........................................1;
OCgANI/ ...........................................4
EW LEALAND .....................................43
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11/XJ91LEXP1 RTERS.
Arc ont-Inii
Prolonged drought and hot winds have seriously damaged
Argentina's wheat crop and will probably cut the 1974/75
harvest now in progress to 4.8-5.4 million ton!;; some
20% below last year's production. While higher support
prices have been announced for corn and sorghum, they are
inadequate in view of higher costs and inflationary expecta'`ion:;.
Consequently, feedgrain production may drop by as much as 52.
Despite an overall net reduction in production of major
grains large carryover stocks should provide maximum export
availabilities of 2.5 million tons of wheat and 10.5 willion
tons of feedgrains in US MY 75. Historically, however, actual
grain shipments have fallen below estimated availabilities
because of inadequate transport and storage facilities, and
1974/75 will be no exception. Lags in deliveries have been
reduced somewhat this year, but shipments are still running
`.behind schedule and major bottlenecks
can be expected by mid-1975 as corn and sorghum harvests
strain handling capacity. Therefore, actual exports of
grain will probably be no more than 10.3 million tons or
90% of maximum handling capacity.
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Prof cctcc
Production Ex,Ior. is / Exports ~?/
1973/74 1974/75 MY 74 MY 75
Wheat 6.5 4.8-5.4 1.1 1.9-2.5
Corn 9.9 10.0 5.7 5.7
Sorghum 5.92/ 4.82/, 2.8 2.7
1/
2/
1 July-30 June for wheat; 1 Oct-30 Sept. for corn and
sorghum.
Losses from handling in 1974 were 1.2 million tons and
in 1975 are estimated at only 0.3 million tons.
This year about one-third of the Argentine wheat exports
will go to Europe, the USSR and Italy being the only purchasers;
Asia and Africa will each get about one-fourth and the remainder
will go to South American countries. The USSR and a few
other European countries are taking about 40% of the Argentine
corn exports; Asia, ? primarily the PRC, about one-fourth;, and
Latin American countries, including Cuba, the remainder.
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Auatra.1i.a
Australia's last December-January (1973/74) wheat harvcs L
totaled about 12 million tons, third largest on record, resuILincj
mainly from a more than 20 Percent increase in acreage.
Taking into account carryover stocks and a projected
output of_ 11 4 million tons from the upcoming 1974/75 harvosL,
the Australians have 8.5-8.7 million tons available for export
during FY 75, about 2 1/2 million tons more than during FY 74.
A large share of this amount has already been sold.
The area sown to barley, Australia's second largest grain
export, declined last year because of the expansion in wheat
acreage. Still, a good crop was harvested and production in 1974
was up nearly 40% over 1973. The outlook is for a harvest of
some 3.2 million tons next spring, which should leave 1.9 million
tors of barley available for export during FY 75, compared
an estimated 1.2 million tons exported during FY 74.
Production Expor
1973/74 1974/75 Exports Availability
FY 74 FY 75
--------------------million tons--------
-----------)
12.0 11.4 6 8.5 - 8.7
Barley 2.4 3.2 1.2 1.9
Canada
Wheat: Estimates for Canada's 1974 wheat harvest have
ranged from 13.4 million tons to 14.3 million tons -- down
from last year's level of 16.5 million tons. Early official
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Cdg,rndian c tim.:itcs placed the harvest: at 14.3 million tons
but did not take into account killing fr.orzs in late September.
Tht, USDA recently adjusted its estimate of the Canadian halve-,t dorm Lo ] . 3
million tons and expects it to go lower. Recent comments from
tht, Canadian Wheat Board, however, indicate that the final figu.:,,~
mi'.iht be close to the original 14.3 million ton estimate
bei':iuse of recent good weather. The extent of the damage will
be more
fully known when the Canadian government releases its
latest offi.iai estimates on 22 November.
Production
Exports
Export
Availability
1973/74
1974/75
FY 74
FY 75
Whi,at
16.5
14.2
11.5
10.5
Barley
10.2
8.8
2.7
2.7
Equally significant as the output shortfall is that
tht? early frost adversely affected the quality of this year's
harvest. Trade sources estimate that no more than 36u will
griide No. 1 & 2 CWRS milling wheat as compared with 60%-70%
in a normal year. Another 34% is expected to grade No.3
CWI(S milling. Utility wheat -- suitable only for feeding
livestock -- is expected to account for about 30% compared to
tho usual 1% of the crop.
Despite a smaller output, exports could still reach about
10.5 to 11.0 million metric tons (assuming . 14.2 million ton harvest) if
the Canadians draw down stocks by 2.3 million tons to 6.u million
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by 31 July 1975.
The 1 August 197
stocks at 10.3 million tons were equivalent co a ,two year
domestic supply. Canada has not sold any major quantities of
wheat since early July and officially suspended export sales in
October pending new crop estimates. To date, about 7.7 million
tons have been contracted for export.
The level of wheat ex.-pc,':ts m ly be lower than 10.5 million tons dei es/linc,
final discussions about size of stock carryovers, quality of
harvest, and pricing policies of the Canadian Wheat Board.
In FY 74, the Canadian Wheat Board raised its prices well a.7ove
those of the US market in anticipation of shortages in the
United States. If a similar policy is followed again this year,
export volume would tend to be depressed, especially for sales
to LDCs already hard pressed by high oil import costs. Also
if feedgrain prices escalate, Canada may use its limited transport
capacity to export more feedgrains instead of wheat.
Feedgrains: Canada, a net importer of corn, probably will
import 700,000 tors from the US in FY 75 compared to 785,000
tons in FY 71. 'rhe large amount of poor quality wheat harvested
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CoNrInpJ I I,It
will make more available for livestock feeding this year.
The bar l -y harvest this fall is expected to reach only 8 .0
million tons, about 14% below the 1973 crop. Increased stocks,
however, will proabaly make about 2.7 million.tons available
for export in FY 75, the same as in FY 74.
South Africa
South Africa is the world's third largest exporter
of corn. Most of South African corn exports during the US
1974/75 corn .aarketing year will come from the record 11 million
ton crop harvested in 1!pril - June 1974. Carryover stocks
from the 1973 harvest were at a record low. Assuming an average
harvest in 1975, the government of South Africa will make
surpluses available from the 1974 crop for export in MY .75
up to the transport capacity of about 4 million tons. This
represents a dranatic increase over the 1.2 million tons exported
in the previous US marketing year. Based on trends previous to
last year's poor harvest, an can be expected to purchase
about 1.1 million tens and the UK about 1 million tons.
Taiwan has contracted for about 450,000 tons. Most of the
remainder may go to other Asian countries and Venezuela.
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Cor:r!nuirlAV 25X1
Wester. n l.u rcii~c
European grain production in 1974 has set a record of
139 million tons -- 4%% higher than last year -- according
to preliminary estimates. The high output results from an
expanded grain area of nearly 1 million hectares; yields are
approximately the same as last year's level. Most of the
increased area was sown to wheat, thus contributing to
a boost in wheat output of 4.6 million tons or about 9%.
Production of coarse grains may be up slightly to 83.7 million
tons but has been hurt by dry weather. Major gains in grain
production will be registered by Spain, France, Italy, and
Sweden.'
Wheat: Only about one million tons of wheat is expected
to be available for export by Western Europe from other than
the European Community (EC). Given the record harvest of
wheat and large carryover stocks in the EC, an estimated
14-15 million tons should be available for export or for
livestock feed. Because of the poor US corn crop with
resultant high prices on the world market.and US official
pressure on the EC to reduce feedgrain imports, the US will
probably feed 2 to 3 million tons more wheat to livestock than
lL-.st year. The EC is raising wheat export levies which should
help keep internal wheat. prices below corn prices, stimulatincr
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the use of wheat for livestock feud. Even tLough more
wheat will be going to l,lvestock than last year, the
record harvest and large stocks will enable the EC to raise
exports of soft wheat to 5.8 million tons from last year's
5.4 million tons. Most of this wheat (including flour) will
go to India, regular customers in Africa, and to fulfill food
aid commitments. Considerable uncertainty surrounds the total
export level at this time.
The main wheat importing area in Western Europa is also
the EC, which we estimate will import about 4 million tons
(excluding intra-EC 9 trade) in FY 75, about the same as in
FY 74. Hard wheat as well as d-.rum is used for mixing with
the domestic soft wher,ts by the milling industry. The ultimate
level and type of imports will depend not only on the size of
the ',arvest but also on milling quality and protein content
of the wheat. There are reports that the demand for high
quality protein wheat by EC millers is greater than a year ago.
The lower supply of high grade Canadian wheat will strengthen
demand for US No.2 Hard Red Winter wheat.
Feedgrains: Western Europe is a large net importer of
feedgrain, especially corn. In FY 74, the region's net fecdgrain
imports were 21.4 million tons. The US sold over 15 million tons
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of these feedgrains -- mostly corn -- to the regior.
including 11.5 million to the EC.
According to a 1 November forecast of the USDA,
Western Europe's FY 75 not imports of feedgrains are to
drop 5.4 million tons to 16 million tons. This reduction
is based on a drop of 1-2u in the total grain fed livestock
coupled with the expanded feeding of dorrestic wheat. In turn,
EC corn imports in MY 75 from the US are estimated at 7.0
m,:llion tons -- about 2.8 million tons less than last year --
out of a total import requirement of 9.6 million tons. The
remaining corn import needs will be met by Argentina and
South Africa.
Considerable uncertainty remains in the estimate that
the EC will significantly reduce US corn imports to 7.0
million tons. Export contracts for corn as reported by US
brokers on sales to Western Euorpe are running at about 14
million tons. Undoubtedly these data are inflated as a hedge
against possible imposition of US export controls and includes
some corn for shipment to Eastern Europe in'other West
European countries, but there is no way of knowing how much.
Even if the EC does reduce corn purchases from the US, the
corresponding decrease in EC wheat exports.will shift pressure
from the US corn market to the wheat market.
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C01'.!'1 1 . rJ l :
ter _ flf'OM
WESTERN HEMISPHERE
Brazil
Wheat: A 45% increase in wheat production to about 2.8
million tons is expected from the December harvest. This
combined with some reduction in stocks will decrease the
need for imports from 2.8 million in FY 74 to 1.5 million
tons in FY 75. FY 75 wheat impor. s from the US are estimated
at nearly 1 million tons, compared with 1.6 million in FY 74.
Corn: The corn crop during MY 75 is expected to exceed
moderately the 15 million tons produced last year. Brazil's
e.cports probably will continue to recover from their suspension
in 1973 and could reach 1.0 million tons in MY 75 although
700,000
t'oris is a more likely export volume. MY 74 expor?
600,000 tons.
Chile
Wheat: Wheat imports in FY 75 are forecast at 950,000
tons, below last year's level of about 1.1 million tons.
Earlier forecasts for a substantial rise in wheat output
and a big decline in imports have been revised because heavy
rains and flooding delayed plantings and destroyed about
10% of the.winter wheat crop. Chilean wheat consumption
is stagnating, in part, because of an April 1974 decree
limiting wheat use to human consumption. It is estimated
that 700,000 tons of the FY 75 wheat imports will come from
10 -
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the U.S., 115,000 Lon:; more than durinU PY 74. About
200,000 ton:, of US wheat have been contracted for delivery
in rY 75 of which about 100,000 tens have been shipped.
The US is supplying 100,000 tons of wheat under a PL-480
credit and is expected to supply an additional PL-480 credit
for 100,000 tons during rY 75.
Corn: Corn imports this year are expected to decline
slightly to 250,000 tons -- about 25,000 tons below last
year. An excellent crop this year and forecasts for higher
output next year will enable Chile to reduce imports while
increasing tot?:.i1 consumption. The increase will be used
mainly for animal feed. US corn will probably account for
150,000 tons of this year's imports compared with 126,000
tons last year.
Colombia
Assuming favorable weati-,!r conditions, production of
most grains will increase substantially this crop year,
reflecting success of government efforts to stimulate
agriculture with credit, technical assistance, and price
supports. Output of wheat is expected to increase by 807,
to about 100,000 tons and corn by 30, to 760,000 tons.
Elmination of the wheat import subsidy in mid-September,
higher wheat prices, and a government program to encourage
the use of wheat substitutes in baking will discourage imporL:;
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in FY 75. The combined effect of these mea :ures will
probably be to hold wheat imports at around 360,000 tons
compared to 470,000 tons last year. About 90% of the wheat
imports will come from the US.
Mexico
Wheat: Wheat production in FY 75 is estimated at 2.2
Corn: Widespread crop damage has
estimate of corn import needs.in MY 75 to 1.3 million tons,
mostly fran the US and Argentina. Corn production is now estimated
at 8.1 million tons, 15% below initial forecasts. Early
frost reduced the crop by an estimated 700,000 tons, and
scattered damage has been reported from drought and hurricane
Fifi.
million metric tons, up 10% from FY 74. However, consumption
is also increasing at a rate of about 10% per year and is
expected to result in imports of roughly 850,000 tons, all
from the US. Purchases of US wheatEor FY 75 already tota;.over
7,70,000 tons. Mexico took 706,000 tons of US wheat in FY 74.
tripled the earlier
Peru
Wheat: Peru's FY 75 wheat production is e:-{-imated at
about 160,000 tons, 710 over last year. The government expectcd
to reduce imports this year by about 8% to 720,000 tons through
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higher domestic price!] and government import restrictions.
A more realistic estimate by the USDA attache
puts import needs at about 965,000 tons if shortages are
to be avoided. The higher estimate means that Peru will
probably need about 700,000 tons from the US. About 374,000
tuns have been scheduled for delivery from the US during the
l.,t half of this calendar year. Total imports could reach
ncirly 1.2 million, however, if Peru's request for 200,000
tans on CCC credit is approved.
Corn: Corn production will decrease slightly, about
3%y 'this year due to shifts from corn to cotton, production
and short fertilizer supplies. Corn import needs could e::cecd
300,000 tons, 75% of which will be purchased from the US.
About 220,000 tons of US corn went to Peru last year.
Venezuela
Wheat: Little wheat is grown in Venezuela and because
shocks are low wheat imports in FY 75 should be around 600,000
tons compared to 580,000 tons in FY 74. Imports of US wheat are
estimated at 540,000 tons in FY 75,of which over 300,000 tons
are already our.chased.
Corn: While 1974 corn production is expected to be
25?x, an increase in corn imports is expected in FY 75
up by
least 300,000 tons from 275,000 tons in FY 74 -- because of
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strong demand end government policy to incrua:;c poultry, Pork,
and dairy production. Most of Venezuela's imports arc
expected to be South African and Argentine corn.
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ASIA
Bangladesh
We estimate FY 75, foodgrain production at about 12 million
tons, the same as last year. Although summer floods slightly
damaged the last summer rice crop which normally accounts for
25% of production, the flooding should improve the major rice
harvest starting in November which normally provides 60 of
annual production.
We estimate foodgrain imports in FY 75 at 2 million tons ---
including 1.7 million tons of wheat and 300,000 tons of rice.
(Imports in FY 74 totaled 1.7 million tons made up of 1.6 million
tons of wheat and 100,000 tons of rice.) Imports of 2.0 million
tons -- if achieved -- will maintain government rationing in
urban areas for the remainder of FY 75 and allow for a slight
increase in government relief. Insufficient imports during
September and early October resulted in more hunger than usual
prior to the major fall harvest. Bangladesh
will remain vulnerable to such disruptions in imports.
Imports already arranged for FY 75 total about 1.4
million tons, including 250,000 tons of PL-480 wheat
and rice shipments. Acquisition of the remaining 600,000 tons
is largely contingent on receipt of additional foreign assistance.
Bangladesh will remain dependent on aid-financed grain imports
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in the foresrcnhle future.
Burma
Wheat: Severe floods during August this year probably
destroyed about 500,000 tons of rice, or about 10L of Burma's
annual output-. This loss further eroded the country's
precarious foreign exchange position and has accentuated
the already tight domestic food situation. The rice destroyed
was roughly. equal to past annual exports and represents a
prospective loss of at least $150 million. Food shortages
earlier this year led to civil rioting in June, prompting
a halt in rice exports and government promises to alleviate
shortages of food and other consumer goods through imports.
Burma would like to import 40,000 tons of wheat in FY 75.
The Burmese delegation attending the IMF/IURD Governor's
meeting in Washington in late September sounded out US officials
on aid, citing the recent flood losses as justification, but got
no commitments. If aid is not forthcoming from other sources,
Burma will probably import only about 15,000 - 20,000 tons
of wheat in FY 75, mostly from Australia.
Corn: Burma imports no corn, but produces about 140,000
tons of corn for domestic consumpt: on.
Cambodia
Wheat: Cambodia produces no wheat domestically, and
corn production is a small fraction of pro-war levels. Wheat
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imports come exclusively from the US ,and are expected to
be 35,000 tons for FY 75.
Corn: Corn, once an important export, now is imported
primarily for animal feed. Domestic corn output is very
sensitive to the ever-changing security situation. The
Cambodians have requested 5,000 tons of corn in FY 75
from the US, and most of this amount will probably be delivered
between now and the end of September 1975.
India
India faces serious foodgrain shortages which will persist
at least until the 1975 fall harvest. Below normal monsoon
rains damaged this year's fall crop which is estimated at
58-6C million tons, depending on conditions
through the harvest. The 1973 fall harvcsttotaled G7 million
tons. The current situation is analogous to 1972 when
wide-spread food shortages were last experienced. While this
fall's harvest should be larger than the drought-reduced fall
harvest of 57 million tons in 1972, India is not better off than
2 years ago because:
?government grain stocks on 1 July 1974 were only 4
million tons compared to 9 million tons on 1 July 1972;
and
?India has 25 million more people than in 1972.
A poor harvest will increase pressure on the government's
grain distribution system, which provides subsidized grain sales
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in urban and other select deficit areas. In FY 74 11 million
tons were di tributcd by the government, compared with 11.7 million
tons in PY 73. A minimum of 12 million tons will be needed in
FY 75. Judicious distributio:) of this grain by the government
should reduce the incidence of urban food riots but will do
little to alleviate widespread hunger in rural areas.
Imports and government procurement of domestic grains
make up government supplies. To distribute 12 million tons of
grain, the government will need 6-7 million tons of imports in
FY 75. We believe India will not push grain imports much above
7 million tons without more grain provided as aid. The remaininc,j
grain for goverr, 2nt distribution will come from stocks -- 4 millic:.
tons on 1 July -- and government procurement which we estimate
at 2 million tons from the fall harvest. Procurement from the
spring harvest will be too late to provide much for distribution
in FY 75.
To date India has arranged 6.0 million tons of grain
imports,. as follows:
? 3.1 million tons of commercial US purchases, and
300,000 under PL-480;
?1 million tons of EC wheat including 300,000 as aid;
?430,000 tons of sorghum and 250,000 tons of wheat
purchased from Argentina;
?500,000 tons of Canadian wheat, including 140,000 tons
as food aid;
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0340, 000 tons of Australian wheat including 40,000 as
grant aid; and
0100,000 tons of Soviet wheat due from last year's grain
loan.
Indonesia
Wheat: Since no wheat is produced in Indonesia,
consumption needs are met by import.whi.ch will be about
730,000 tons in FY 75. The government
has requested 100,000 tons of PL-480 wheat that will probably
not be granted. About 140,000 tons have been scheduled through
grant arrangements with Australia and Western European countries.
The rcnainder will be purchased commercially mainly from
Australia, with small amounts from Canada and the US.
Corn: Corn production in Indonesia is sufficient to
meet domestic needs, and no imports are planned for the
period. Exports destined primarily for other Southeast Asian
countries should reach 250,000 tons.
Iran
Wheat: Iran is buying nearly 1 million tons of wheat
more than previously estimated. Lack of rainfall in April,
May and June seriously affected dry-land wheat and a large
portion of so-called irrigated wheat. FY 75 production has
been revised down to 3.7 million tons, compared with 3.95
million tons harvested last year, and the consumption estimate
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has been revised upward to 5.4 million tons. Under pressure of
lower output, increased consumption, and a desire to boost
stocks, Iran will be in the market for an estimated 2.3 million
tons of wheat in FY 75 with possibly 1.9 million tons of that
to come from the U.S. In FY 74 the US supplied Iran with 90
of the one million tons of wheat imported.
Corn:, A small percentage of the total supply of corn
in Iran is produced domestically. The major portion of the
balance has historically come from the US. The growing dermands
of poultry and livestock for feedgrain has increased imports
of corn into Iran from a yearly average of 25,000 tons in
1969-72 to about 100,000 tons in MY 74. Corn imports during :'.Y 77,
will be about 250,000 tons, including 225,000 tons from tl.e US.
Iraq
Wheat production in 1974 is estimated at 1.6 million
tons, compared with an average of 1.4 million tons during
the past four years. Most of the wheat is produced by
Kurdish farmers in the north, however, and poor crops in the
south this year' plus rapidly expanding wheat use by flour
mills near Bagdad and Basra has buoyed the rising trend in
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wheat imports. Total wheat ;1nport n in FY 75 are estimated
at 675,000 tons, compared with 525,000 in FY 74. About
410,000 tons of FY 74 imports wc.re from the US. This year
we estimate that Iraq will take 445,000 tons of US -heat.
Outstanding export sales plus shipments already made as
of 17November stood at 557,000 tons, indicating'that actual
shipments could go higher.
Japan
Wheat: Japan's FY 75 wheat imports still are expected
to total about 5.7 million tons, up from 5.- million tons
in FY 74. This 5% increase is in line with the long-term
average, growth in consumption. ? Imports of US wheat will
be much the same as in FY 74, or about 3.2 million tons.
Australia will supply at least twice as much as it did
last year.
Japan's official wheat purchasing agent, the Food Agency,
apparently has reverted this year to its normal habit of
buying small amounts weekly over a several-month period. As
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C0r;r;TIt I
of 1.7 1JovcmUer., US wheat shipments to Japan combined with
outstanding or(ler amou:ited to n.arly 2.2 million tons.
Corn; The Japanese appear to have lined up more corn
than they need. for MY '75. Excess orders for US corn could
amount to at least 600,000 tons.
Demand for imported feedgrain (corn and sorgbim-,) is
expected to decrease by 2%-3% at most, to < total of 12.8
million tons. Of this, corn may account for as. little ac, 8.::
million tons. In view of arrangements already made with such
other suppliers as Thailand and South Africa, demand for US
corn should be on the order of 6.1 million tons down 300,000
tons from actual imports last year. Yet to date, shipments
plus outstanding orders amount to 6.7 million tons.
Malaysia
Wheat: Traditionally Malaysian import requirements
for grain have l:cen obtained from nations in the Southeast
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Asian region. Malaysian wheat imports from the US are
expected to be about 10, 000 ton-I in FY 75 (down from 15,000
tons in FY 74), while most of the remaining 3G5,000 Lons
of wheat requirement will come from Australia.
Corn: Although 23,000 tons of corn were imported from
the US during MY 74, this was an anomaly resulting from
the shortfall of the Thai crop that year. Corn imports
from she US could be as much as 15,000 tons in MY 75,
with the remainder of the 200,000 to-,1 corn requirement
coming from Thailand.
Pakistan
We estimate Pa);istan's FY 75 wheat imports at 1.2 million
tons, 200,000 tons more than in FY 74. We attribute this
increase to the lack of significant improvement in the 1974
spring wheat harvest over 1973 -- the spring harvest accounts
for the major share of grain output -- and to poor prospects
for the 1975 spring wheat harvest because of below normal
monsoon rains last summer. Official estimates of the 1974
spring wheat harvest range from 7.5 to 8.0 million tons
compared with 7.8 million tons in 1973.
Pakistan recently raised its official FY 75 wheat import
requirement from 1.14 to 1.5 million tons because of growing
concern over the poor outlook for 1975 wheat production and
rising domestic grain prices. We believe Islam-.;i.~aci will not
push F'Y 75 grain imports to 1.5 ;pillion however, uiil o.ss
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Cc=. ~,l 25X1
large now aid commitments are forthcoming. So far, import of only
650,000 tons have been firmed up, including 300,000 -tons purchascd
from the US and 100,000 tons under PL-480. Requests to
several other potential food donors have met with only
limited success, in part because neighboring South Asian
countries are worse off. Pakistan will continue to seek food
aid while pursuing commercial wheat purchases.
The nation is in a reasonably good financial positio!i
due to the recent rescheduling of its foreign debt, a
$500 million aid commitment from consortium countries and
several hundred million in loans from oil-rich Moslem
countries. Nonetheless, import costs have soared while
markets for its principal exports -- cotton and cotton
textiles -- are sagging.
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Pc_c~~ln'_=
The PVC h,1 rc dt,c:t :l fc~odrjr;i i n import:n from rtre:v i rnu:;1 y
p3annecr for the cur.rvnt fiscal year, but the expiate ition
for the reduction..; is not yet clear.
?'20p o!: iic.i,t..U; of Like r'cin.int:ry of Agri.ru] tore and
Fore:: try ii vc:, r~r.ce_iieLed that 1974 grain production
will be in exec .,?, of 250 million ton:;.
of early ii vented drain crop,,; -- -
normally acco;inL.ing for 407, of Local on Lpu l: -- were
below norm,l due Lo drow;i,L in the north unrl early
frost in t:,,- South. Expanded acreage could have kept
production equal to 1973.
?i"'all crops -- still being harvested -- suffered from
a poor monsoon this Greater water conservancy
may have moneratec, the weather influent, but it in
questionable whether the important fall harvest will
exceed that of 1973.
?Growth in grain ou tpttt this year has a]. ,o been limited
by holding the increase in fertilizer supplies to only
7 ~, compared with 1.6 in 1973.
PRC wheat import reductions of about 23". coi,,qparud Lo
previously anticipated FY 75 levels may indicate a bumper
harvest or it may mean that China has temporarily placed
reduced priority on its policy of replenishing grain stoeeks.
In anj case, recent Chinese subchartering to other countries
of more than fifty ships originally hired to carry US grain
appears to indicate a reduced Chinese requirement frr U.S wheat.
China's prime suppliers -- Canada and Australia -- are, however,
not being affected. Generally, the PRC is cutting back corn
imports and expanding those of wheat relative to FY 74.
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Colo II,CIJ rl.",I
Whc i t : Total wheat. impcor. t:; probably will amountt, to
abouL 6.9 mtl.li.on Lone, in I'Y 75, compared with 5.9 niflion
torn; in FY 74. Source,; of the wheat this year will be
1.7 million ton:; from the US, 3.0 million tons from Canada,
1.6 million ton!-, from Au ntralia, 0.4 million tons from
Argentina, and 0.2 million tons from the EC.
Corn: For the US marketing year, about 800,000 tons
pf corn will be Imported, nearly all from Argentina. There
are still a}x t 50,000 tons of US corn on the books. China
is not expected to buy more US corn because of dissz.tisfaction
with quality.
Philippines
Wheat: Projected imports of wheat for the Philippines
are about 630,000 ton, for FY'75, up from 524,000 tons in FY 74
when foreign purchase's were held down by high costs and
domestic pricing problems. Three-fourths of this year's
imports will come from the US and the maior part of the
remainder will come from Canada.
Corn: Corn production will be up slightly this year, but
corn imports are expected to increase by 10,000 tons to at
least 100,000 tons in MY 75. Imports from the US will be
about 80,000 tons. The Philippines has asked for 50,000-
60,000 tons through the PL-480 program and .intends to get the
balance through commercial transactions. If aid is not
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Cr)tli':'1-01T1: I
forthcoming, the full 80,000 ton:) pr.ol)dbly will be purchased.
Importvci corn, which Is used by commercial feed miller. ,,
relczc:.es domeut.ic white corn for human consumption.
Saticii Arabia
Wheat: Improvements in rural living standards, which
will trigger a shift in diets from millet and sorghum to
wheat and rice, account. for the estimated increase in total
wheat imports to 600,000 metric tons in FY 75 from 475,000
tons in FY 74. With expanding US-Saudi relations, wheat
ir)ports from the U:' during FY 75 can be e::pcectcd to increase
to about 400,000 tons from an estimated 150,000 tons in I'Y 74.
Corn: Saudi Arabia's corn imports reached about 32,000
tons in 1965 but remained below that level in 1966-73.
Now facilities to prepare poultry feed from imported corn will
push corn impart needs to around 30,000 tors in MY 75 with
about 1.0,000 tons expected from the US.
South Korea
Wheat: In F? 74, South Korea imported 1.6 million tons
of wheat and 30,000 tons of wheat flour, all from the US.
Domestic production from the June-July harvest is down 8. to
150,000 tons, _u-j consumption is increasing. Demand in FY 75
is estimated at 1.8 million tons. Assuming no change in stock::,25X1
imports in FY 75 will tonal about 1.7 million tons.
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Corn: In the 1973/74 marketing year, South Korea
imported an estimated 465,000 tons of corn, including some
420, 000 tons from the US and about 45,000 tons from Thailand.
In MY 75 requirements for food corn arc estimated at 500,000
tons, while those for non-feed purposes should total about
150,000 tons. Production of corn from the September-Octobar
harvest is estimated at 60,000 tons, the same as last year.
Since no change in stocks is indicated, MY 75 corn imports
are estimated at 590,000 tons. Most of the corn -- about
490,000 tons -- will be sought from the US. Small amounts m+,y to
purchased from South Africa and other countries.
Rice: Rice imports in FY 74 amounted to just over
210,000 tons. Last year's October-November crop totaled
4.2 million tons, and this year's harvest will be slightly
larger despite adverse weather conditions during the summer.
Government stocks were low at the start of FY 75, and rice
consumption will likely increase as a result of a poor
barley crop this fall.- In FY 75, Korea plans to import some
430,000 tons of US rice, including 200,000 tons on a conm:crcial.
basis and the remainder on a concessional basis financed by
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$8G million of PL-400 asrA:.trance.
Korea's ability to finance grain imports during FY 75
is being adversely affected by soaring oil import costs and
a slowdown of export growth. The balance of payments current
account is expected to be about $1.5 billion in the red in
1974, compared with last year's $300 million deficit. Korea
has accelerated its foreign borrowing to meet its increased
financing needs and has avoided a significant d.rawdown of
its foreign exchange reserves. Official reserves remain at
just under $1 billion, which covers less than two month's
worth of imports. Through Septemi.?er, Korea obtained $910
million in new commercial credits, at least $350 million in
official loans and equity investments, and borrowed somo
$50 million from the IF. Korea's need for foreign cal i-nl
will remain essentially unchanged in FY 75. During this period,
the US will provide some $180 million in official economic
assistance, including nearly $155 million in PL-480 aid.. This
amount should help cover the larger deficit -- roughly $300
million more than was forecast! in early 1974. The
remainder will be financed largely by increased borrowing from
the Mr.
South Vietnam
Wheat: Wheat consumption in South Vietnam has declined
by about 750 from last year due to domestic prices that have
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increased by as much a!; 300;,. Because of this, the
government has reduced its request for PL-480 wheat to
100,000 MT, down from the previously estimated 240,000
ton requirement. The current request anticipates a slight
rise in wheat consumption from the depressed levels of
last fiscal year.
Corn: Vietnam produces some corn for both human and
animal. consumption, and previous PL-430 imports have been
used for animal food. Because of recent gains in the
production of be h feed corn and sorghum, the Saigon
government is not requesting any corn imports under PL-480
and is unlikely to import any from other sources.
Sri Lanka
Sri Lanka's foodgrain situation is tight. It could
further deteriorate early in 1975 if the major rice crop
which is harvested starting in February declines from last
year's record 750,000 tons. It is too early, however, to
forecast the harvest because it depends on rains during the
November-February northeast monsoon. The government is hoping
for a good harvest as high world grain prices, foreign exchange
shortages, and difficull-'i es in securing food aid are limiting
calendar 1975 import pl,A. to 750,000 tons of rice, flour, and
wheat -- 100,000 tons less than actual 1974 imports. Arrange-
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ments to date fall 200,000 tons short of the ,e minimum 1975
import plans.
Taiwan
Wlheat: - In FY 74, Taiwan imported just over 700,000 tons
of wheat, of which about GG5,000 tons came from the United
States. About 640,000 tons were consumed and the remainder
went into stocks. According to Taiwanese statistics, stocks
at the start of FY 75 stood at 300,000 tons, and will
probably be drawn down by 40,000 tons during the year. ~~cause
of high wheat prices, doiaestic consumption this year is cxpectc,
to be slightly reduced to some 630,000 tons, while domes-tic
production will be minimal. As a result, imports in FY 75
will total an estimated G00,000 tons. The great bulk -- some
590,000 tons -- will be bought from the United States. The
remainder will be bought from Australia which supplied 16,000
tons in FY 74.
Corn: Domestic demand in 1974/75 probably will total
about 1.2 million tons, while production is estimated at
only 90,000 tons. At the beginning of the current marketing
year, stocks totaled about 290,000 tons,sufCicicnt for nearly
3 months of consumption. A drawdown of about 50,000 tons is
expected during the year. As a result, imports are likely to
run about 1 million tons. Taiwan is scheduled to import
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450,000 L-ons from south Africa, 350,000 tons from Thailand,
and 20,000 tons from Argentina. The remaining 200,000 tons
probably will be sought from the United States.
Thailand
Wheat: Thailand produces no wheat, so will. import
almost 100,000 tons in FY 75, all of it on strictly commerical
terms. Imports from the US arc expected to be about 35,000
tons, up from 30,000 tons in FY 74.
Corn: Thailand is a large producer and exporter of
corn. Production of corn for MY 75 is estimated at 2.3 million
tons, compared with 2.4 million in MY 74. Since domestic
consumption is between 300,000 - 400,000 tones per year, 2x:ports
will decrease from 2.0 million in MY 74 to 1.9 million tons
in MY 75. Thailand has commitments to sell Japan as much is 1.2 n?i11i.'.
tons of its 1974-75 crop. Commitments to Taiwan are about
350,000 tons with the balance going to other Asian nations.
Turkey
For the second consecutive year, insufficient rainfall
has damaged Turkey's wheat crop, the country's most important
agricultural crop and pri'icipal staple food. Production this
year will be about 8.3 million tons, up from 8 million tons
last year but still a significant drop from 9.5 million tons
two years ago, when Turkey was able to export 560,000 tons.
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With sLock already drawn down and food needs increasing,
import of about 1.3 million tor in probably will be necessary
in PY 75, up from 520,000 tons last year. Imports of US
wheat this year is expected by the US AgriculLural Attache
to increase to 750,000 tons, compared with 450,000 tons last
year. OuLstandin