The production outlook for the current bulletin includes only the major producers in the southern hemisphere and some isolated northern hemisphere countries where crop  development is sufficiently advanced to ensure that estimates are reliable. Detailed production estimates for  Brazilian States and Argentinian Provinces are listed in Annex B.  

CropWatch production estimates differ from most other global estimates by the use of geophysical data in addition to statistical and other reference information such as detailed crop distribution maps. Recent sub-national statistics are used for the calibration of remote-sensing-based models. It is also stressed that the assessments and underlying data are crop-specific, i.e. based on different crop masks for each crop and that, for each crop listed in Table 5.1, both yield variation and cultivated area variation are taken into account when deriving the production estimates.

A specific section on environmental conditions that prevailed among the major importers and exporters between October 2018 and January 2019 is provided in Chapter 3.1

Maize

Table 5.1 includes the second and third exporters of Maize (Brazil and Argentina) which both export about 20 million tonnes of the commodity annually. Other exporters include South Africa and Mexico which commercialize about 1 million tonnes each, as well as Zambia with less than 500 thousand tonnes. Argentina did well (production up 9%) while the CropWatch estimate for Brazil is 1% down. Brazil exports about 25% of its maize production while the percentage is much higher in Argentina at more than 60%. Maize available for export should thus not be affected by the current situation in Argentina and Brazil. Mexico is net maize importer; it usually exports a very low percentage of its production (around 3%), so that the rather favorable production will merely reduce imports - which are in the range of 12 million tonnes - by about 25%. In south Africa, where exports and imports balance each other out, the production shortfall is likely to increase imports from outside the region as most countries suffered from a poor rainfall season which has reduced their maize output, as shown in the table for Angola and Zambia.

Rice

The rice production of Brazil and Argentina is up by 4% and 16%. Both countries rank about 10th among the rice exporters, more or less at the level of  countries such as  Uruguay, Paraguay,  Italy and Cambodia. Both countries are minor net exporters - they are far behind the major Asian exporters which market about 10 times more - and their output will be neutral as far as international markets are concerned.  The same applies to Mozambique which has a net import of rice that varies between 100 thousand tonnes and 150 thousand tonnes.

Wheat

Australia has been one of the top 5 wheat exporters, although the position of the country among exporters varies from year to year because of the inherent variability of wheat output. If the production variability is defined as the ratio between the largest output and the smallest one over the last 10 years, production variability reaches 2.3 in Australia, Argentina and Kazakhstan but only values between 1.2 and 1.5 in India, the United States and France. Similar results are obtained with more complex measures of variability, for instance coefficients of detrended variability, which are close to 1.3 in Australia, Argentina and Kazakhstan, but only 0.5 in India, the United States and France. In short, the wheat production drop in Australia  (-13%) may be spectacular, but it is nevertheless in line with the recent history of wheat production in the country.

The other negative value in Argentina (-3%) is also rather consistent with the recent behavior of wheat in the country. Not only: among the top ten wheat exporters, Argentina is the only one where the average production of the last five years (12.2 million tonnes on average between 2013-2017, based on FAOSTAT data) is below the production of  2001-2005 (15.0 million tonnes). This is due to a variety of factors but weather variability has played and continues to play a dominant role.

Australia is the major wheat exporter among those listed in Table 5.1. Exports, which have recently been in the range of 17 million tonnes are likely to fall  by several million tonnes. Exports of Argentina, the second largest exporter among those listed in the table (5 million tonnes exports) are unlikely to be affected. Nor are those of Brazil as the country exports virtually no wheat.

All the other countries in Table 5.1 produce wheat essentially for domestic consumption. India and Pakistan are basically self-sufficient, with minor imports and exports only. Others, such as Mexico, Morocco and especially Egypt are among the world’s top wheat importer. Egypt is actually the world’s first wheat importer with a volume in excess of 10 million tonnes annually, less so (around 5 million tonnes) for Mexico and Morocco. The improved production will allow the countries to reduce imports.

The same applies to South Africa. The country used be an exporter of the same importance as Australia, but over the recent two decades South-African farmers have reduced production to grow other, more profitable crops, to the extent that South Africa is now a net importer of about 1.5 million tonnes. The estimated production increase will allow the country to compensate, albeit in a limited way, the reduced output of maize.

Soybean

Brazil and Argentina, which both increased their soybean production, are the second and third exporters for the commodity (about 50 million tonnes and 9 million tonnes, respectively). While first exports about 60% of its production, the second exports about one third. In Argentina, the extra production in 2019 (about 4.7 million tonnes) represents about 50% of average soybean exports of the country. As such, the volume of exportable soybean will increase significantly (by about 50%) in Argentina. This is larger that the increase in Brazil, which exceeds to 2018 output by about 2 million tonnes.

When taking into account the recent reversal of the negative trend of Chinese soybean production, and correlated reduced imports, the data in table 5.1 suggest that the current soybean glut will worsen.

Table 5.1: Preliminary 2019 production estimates in thousands tonnes for selected southern hemisphere countries and early crops in the Northern hemisphere. Δ% stands for the change in % compared with the corresponding season in 2018.