Durum wheat production is on the rise, but costs are on the rise
The quantity of durum wheat is growing, but this is not good news for Italian companies that produce pasta. The reason? Production costs are on the rise. Thanks to the inflationary flame. This was revealed by the Italian Agricultural Consortia in Rome in the context of the XVI edition of International Cereal Seminar 2023, promoted by the Chamber of Commerce of Rome. Furthermore, during the meeting, serious questions also emerged on the grain supply chain and market trends, in a context of rising costs of cereal production factors. A complex scenario in which the conflict between Russia and Ukraine, major grain exporters, also plays a significant role.
The Italian data is good
In the 2023-2024 campaign, Italian durum wheat production is estimated to grow (+8.1 per cent) by the Igc, against the resistance of the surfaces of the sown areas. Crea’s estimate is more optimistic: our country’s production should reach over 4 million tons this year, with an increase of about 12 percent compared to the previous campaign, due to higher production yields.
According to USDA forecasts (Rice Outlook, May 16, 2022), globally, in 2023-24, rice production will increase by 12 million tons compared to the previous year, reaching a new record of 521 million tons (worked base). The 2023-2024 campaign for wheat, on the other hand, foresees a slightly lower availability than that of the previous campaign (-1.1 per cent), the result of a decrease in yields and production (-2.5 per cent), only partially offset from the positive level of initial stocks (+3.1 per cent). In the end corn production is estimated to increase by 5.6 per cent compared to the previous year, second only to the record set two years ago.
With better weather, average yields are expected to improve, especially in Argentina and the EU. World barley production for the 2023-2024 marketing year is estimated byInternational Grains Council in 145.7 million tons, -5.2 percent compared to the previous 2022-2023 campaign. A sharp decline is expected in Ukraine. In the EU27, a slight drop in production is expected in the 2023-2024 campaign, which would amount to 50.9 million tonnes (-0.9 percent). According to the IGC forecasts, the 2023-2024 campaign for durum wheat marks a slight drop (equal to -0.9 per cent), settling at 32.4 million tonnes, with the reductions due to the drought in Tunisia and Algeria.
The scenario remains complex
“Like last year, the serious war situation in Ukraine, caused by the conflict with the Russian Federation, also raises serious questions about grain supply chain and market trends, in a context of rising costs of production factors” explained by Cai. A reality that closed last year with a consolidated net profit of 3.2 million euros, an ebitda of 15.4 million and a production value of 587 million.
“Many concerns are expressed regarding the ability to guarantee, especially in some weak areas of the world, an adequate supply of cereals for food purposes” they added. The goal of Cai is to support all Italian agricultural enterprises, thanks to their poles of excellence and continuous research and development activity, thus reducing production costs, providing technical means and innovative solutions for project the sector into the futureincreasing investments in the territories and market opportunities for farmers through supply chain contracts.
“The flattering results of Consorzi agrari d’Italia this year reinforce this great project designed to defend and enhance Italian agriculture” has explained Gianluca Lelli, managing director of Cai. “As the weeks go by, we are structuring an increasingly vast network throughout the national territory, making it visible and recognizable the great role of consortia for each farm both in the supply of products and services and in the valorisation of the great work of farmers”, he concluded.