The following GAIN reports were released on October 8, 2021.
Post forecasts 2021/22 corn harvest at a record 118 million metric tons (MMT), up nearly 40 percent on the disappointing 2020/21 harvest estimated at 85 MMT. Post forecast yield for next season is 5.67 metric tons per hectare (MT/ha) and is based on adequate investment in technology, average weather patterns, and punctual planting of the safrinha corn. Corn exports will also see a recovery next season, after a dismal performance in the current season. Despite surging prices and ample demand, Post does not anticipate significant U.S. corn imports. Post forecasts rice production to level off to 7.8 MMT in 2021/22, a decrease of 200,000 MT from the record production in the current season. Post forecasts wheat production at 7.8 MMT for the 2021/22 season, an increase of over 1.55 MMT from the current season thanks to forecast expansion in the planted area.
Brazil's Marketing Year (MY) 2021/22 sugarcane crop is estimated at 590 million metric tons (MMT), a decrease of ten percent compared to the final estimate for MY 2020/21 (657 MMT). Dry weather, high temperatures, below average rainfall and frosts during all development stages of cane stocks led to a noteworthy drop in production. Overall, sugar prices remain firm and relatively more attractive than ethanol prices. Therefore, sugar-ethanol plants have focused on sugar production, and the sugar-ethanol production mix will be similar to the previous season. The revised estimate for Brazilian exports in MY 2020/21 is 26 MMT, raw value, a drop of 6.15 MMT relative to previous season due to lower sugar exportable surplus. As the second-largest recipient of the U.S. sugar tariff-rate quota, Brazil held a raw value allocation of 181,774 metric tons at the beginning of FY 2021.
With the China Cotton Index (CC Index 3128B) price surging 58 percent from its August 2020 level to RMB 20,150 (or, approximately U.S. $3,100) per metric ton (MT) on October 8, 2021, the Chinese government (PRC) is taking steps to rein in prices. The rapid increase in the cotton price in just the past few weeks has fueled anxiety across China's cotton industry supply chain, including spinning mills, ginners, and farmers.
After two decades of growth, EU chicken meat production is expected to decline by almost 1 percent in 2021 due to HPAI outbreaks and the ongoing impact of COVID-19. For most of Europe, economic challenges even post-COVID will continue to favor cheap protein sources. Consumer preference for chicken meat could fuel some growth in chicken meat demand and production in 2022 , although at slower growth rates than previously estimated. EU chicken meat trade surplus is expected to decrease in 2021 as exports are declining at a faster rate than imports. The lockdown and closure of HRI outlets has lowered the demand for inexpensive imported chicken parts, which are especially popular in lower budget restaurants. The decline in EU exports is also expected continue as long as HPAI-related bans and COVID concerns continue to plague demand in EU customer countries.
Total sales of the hotel, restaurant and institutional (HRI) food service industry totaled JP¥25,517 billion (US$239.1 billion) in 2020, a decrease of 26 percent from 2019 due to the ongoing COVID-19 pandemic. The industry experienced the biggest annual decline in sales since 1994, when industry statistics were first recorded by the Japan Foodservice association. Despite the overall declines, American style fast food chains experienced stable sales, and with easing States of Emergencies (SOEs), increased vaccination rates, and public outings resuming, there's cautious optimism for sales to rebound. Japan's market size and food and agricultural consumption needs are still robust for foreign purchases and will continue to be crucial for U.S. agricultural products that supply the Japanese HRI food service industry.
Post is adjusting its MY 2021/22 crude palm oil (CPO) production forecast down 1.5 million metric tons (MT) from the USDA Official estimate to 18.2 million MT. Acute COVID-19 related labor issues are expected to negatively impact the Malaysian palm oil industry as the Government of Malaysia (GoM) has not finalized a decision to allow foreign workers to work in the sector. As the price of CPO is expected to stabilize in 2022, CPO export is forecast to recover slightly to 16.5 million tons, though this recovery will continue to be restrained by production limitations. CPO production for MY 2020/21 is revised slightly to 17.9 million MT. Exports for MY 2020/21 are revised to 15.5 million tons, a drop of 0.6 million tons from the USDA Official estimate, as all-time high CPO prices throughout 2021 prompt some buyers to switch from palm oil to other vegetable oils. Slower than expected recovery in global vegetable oil demand due to the COVID-19 pandemic also contributed to low export demand for palm oil.
Export prices of white and parboiled rice remained unchanged as the weakening of the Thai baht offset higher domestic prices for Thai rice.
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