ANKARA: Turkish wheat stocks are growing extremely tight, thanks to economic uncertainty and a ban on Russian imports, US officials warned, with supplies implied to fall to less than two weeks of demand by the end of next season.
Turkey is the world’s largest flour exporter, and its milling industry is dependent on tariff-free imports of high protein wheat. But the plummeting currency, and political uncertainty, is discouraging private-sector stockholding, while the government grain body aggressively draws down its stocks, the US Department of Agriculture’s bureau in Ankara said. The bureau cut its ideas of 2016-17 imports by 800,000 tonnes, to 4.0m tonnes, citing “unstable currency, the Turkish grain board’s strong sales, and a reduced tendency by the private sector to want to grow their stocks in an uncertain economic environment”.
Imports are seen rising to 4.5m tonnes in 2017-18, thanks to “ongoing demand for high quality wheat from flour and pasta exporters,” but this will not be enough to stop the steady drawdown in stocks. By the end of 2017-18, stocks are seen falling to just 648,000 tonnes, the lowest estimate on records going back to 1960, “assuming the uncertain economic environment continues to discourage stocking”. The bureau’s forecast implies a stocks to use ratio at an eye-wateringly tight 3.7%, enough for less than two weeks of consumption.
