Even without a new harvest, Serbia currently has wheat stocks in a year, News
No shortages are expected in the oil market because our oil mills and exporters bought more sunflowers last year than they needed
In order not to produce a kilogram of grain in July, Serbia currently has stocks of wheat so that we can live comfortably for about a year, Sunčica Savović, director of the association “Zita Srbije”, told “Politika”. Commenting on the information that our citizens have started buying larger quantities of flour, oil and sugar with the first information about the beginning of the conflict in Ukraine, she notes that there is no need for that because the stocks of grain in the sellers’ camps are large.
– We have more than enough. People should not fall into consumer hysteria. We have never depended on Russian and Ukrainian wheat and corn. They are big producers, the price of their goods also affects ours because we place them on the same part of the world market, but our market has no problem – says Savović.
The escalation of the conflict in Ukraine has currently raised the prices of cereals in the heavens on world stock exchanges. Wheat on the Chicago Stock Exchange rose by 5.6 percent on Thursday, which is the highest since mid-2012. The news that Russia has suspended the traffic of merchant ships in the Sea of Azov until further notice caused additional panic. However, according to Russian officials, its ports in the Black Sea remain open for navigation.
It was confirmed to Reuters that merchant ships are standing in the Sea of Azov. Russia, the world’s largest exporter of wheat, mainly supplies its grain from ports in the Black Sea, while those in Azov have shallower gas and smaller capacities. It is clear that the current events can have further consequences, because Russia and Ukraine together participate with 29 percent in the world export of wheat, with 19 percent in the world deliveries of corn and with 80 percent in the global export of sunflower oil.
– Nothing depends on the real causes, but on geopolitical movements, it is likely that such a jump in prices was caused by financial funds that started buying grain. We will see what will happen next week – our interlocutor states. When it comes to Serbia, the stocks of all cereals are large and she believes that the bigger problem is whether we will be able to export them.
– Wheat has not been traded for weeks. We exported only 60,000 tons in January, which is a small amount – she emphasizes. According to the data of that association, from the beginning of the economic year – July 2021, 667,155 tons of wheat were exported, and if the exported flour is recalculated, the total placement on foreign markets was 762,644 tons. Last year, Serbia had a record grain yield of about 3.4 million tons and a solid transitional stock of about 300,000 tons.
– We consume 125,000 tons of wheat per month for all purposes on our market. When we take away exports and consumption, we currently have stocks in the country of more than 1.7 million tons. It is clear that there is enough grain at this moment, without quantities from the new harvest, for almost a year. That is the real situation – Savović notes. He adds that, on the other hand, it is unrealistic what happened two days ago with prices on world stock exchanges.
He thinks that it is most objective to follow the changes Friday to Friday, because that is when the real picture is obtained. Regardless of the fact that the price of corn on the French stock market went at one point for 57 euros, per ton, subsequently, by the end of that day, that growth was more than half lower. The price of corn on our export market was around 242 euros on Wednesday, and in that panic, during the day, it ranged from 248 to 265 euros per ton. But he emphasizes that this is not the price at which it was traded, but the one that the producers were looking for.
It is inevitable that any escalation from the outside will affect the growth of prices and that this will be transferred to our open market.
– We’ll see what they get next week. I really don’t know how long all this will last. It is inevitable that any escalation from the outside will affect the growth of prices and that it will be transferred to our open market. We need to focus on the fact that we currently have huge stocks of wheat and corn in the country and that exports are going very slowly due to high domestic prices. We will see if that will change in the next month, and otherwise the trade will be stopped before the arrival of a new kind – says Savović.
According to her, what we sell in March and April, if the domestic price is harmonized with the one on FOB, we sold it, everything else indicates that we will enter the new harvest with record high stocks of wheat. That’s what it looks like at the moment. He adds that currently the flow of Russian goods on the Black Sea is not in question at all, but Ukrainian wheat. We will see how this will affect the world market after the information on who their biggest customers are. We should also look for an answer as to whether it is realistic for a part of the quantities to exceed in our country as well.
– What is certain is that as long as there are Russian, Romanian, Bulgarian and possibly Hungarian wheat in the Black Sea region, which is cheaper than Serbian wheat, we will not be able to sell ours. That does not change, regardless of the conflicts in question – she explains.
As for corn, we had lower yields last year due to drought. According to the information of “Zita Srbije”, we entered the new economic year with stocks of about 340,000 tons, and the yield was about six million tons. Domestic consumption requires 4.6 to 4.7 million tons. Exports by the end of January were 570,000 tons. Only if we continue to export more than 140,000 tons a month, we would be able to successfully sell all the quantities by September, when the economic year for corn ends.
Problems and shortages should not be expected on the oil market either, because our oil mills and exporters bought more sunflowers in 2021 than they need, Politika writes.
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