Rabobank Report: Asia, Africa to Lead Grain and Oilseeds Demand; Americas to Lead Supply

Global grains and oilseeds trade will continue to grow, strongly driven by rising demand from Asia and Africa and increased exports from the Americas and the Black Sea Region.

Political tensions, increased protectionism, and weather volatility will keep changing trade patterns.

Sustainability, policy, and consumer trends are expected to continue to incentivize growth of organic grains and diversification of crop production toward more pulses.

Rabobank just released its World Grains & Oilseeds Map 2021, showing trade flows across the globe and key insights for the sector from the last five years.

Its analysis reveals that, in this period, the global trade volume of all grains and oilseeds increased by about 120m metric tons at a 3.5% compound annual growth rate (CAGR).

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However, the pace of growth decreased when compared to the 6% CAGR, or 160m metric tons, of the previous five years.

Although oilseed complex prices declined during this period, the upside in grain prices, coupled with the total trade volume increase, resulted in a 17% increase in the total value of flows.

“Income and population are expected to continue to drive long-term growth in trade flows, while changes in consumer dietary habits might cause further shifts in those flows,” according to Vito Martielli, Senior Analyst – Grains & Oilseeds for Rabobank.

“Moreover, the growing movement toward protectionism could undermine the benefits of international trade, which is crucial to food security,” Martielli added.

Key Changes in Trade Destinations

Rabobank’s analysis shows Africa as the rising grains and oilseeds importer. The main agri commodities imported into the continent are wheat, corn, rice, soybeans, and palm oil.

Egypt has become a key importer of feed grains and oilseeds, driven by a large population and growing feed demand.

China’s rising feed demand is shifting grain and oilseed trade flows.

“Low Chinese corn inventories and rising feed demand are the key drivers behind higher Chinese imports of corn and soybeans, and this is expected to continue, with annual imports potentially exceeding 30m metric tons,” explains Maria Afonso, Senior Analyst – Sugar, Grains & Oilseeds for Rabobank.

Meanwhile, alternative proteins appear as a new driver, but with no impact on pulses trade yet. While growth rates in alternative proteins are strong, the vast majority of pulses goes to feed and (traditional) food.


Key Changes in Trade Origins

During the next ten years, Brazil’s future production growth is expected to continue to take the lead above the US and Argentina as a result of positive farm margins and land availability.

“We estimate Brazil’s soybean production will reach 155m metric tons by 2030, vs. 122m in 2019/20, with soybean area growth likely to come at the expense of underutilized pastureland,” says Afonso.

Meanwhile, Brazil’s export terminals in the Northern Arc will help to ensure the future flow of exports.

Government Policies, Sustainability, and Organic Grains and Oilseeds Production

“Sustainable farming practices are moving quickly to center stage, as agricultural policies are changing to increase sustainability, organic farming, and/or reduce carbon emissions,” explains Martielli. Climate policy is a top priority around the world.

The EU is on schedule to implement the new Farm-to-Fork strategy as part of the Green Deal, which includes a goal of 25% organic land use by 2030.

To download the report, click here.

To download the World Grain & Oilseeds Map 2021, click here.

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