São Paulo – Revenues from exports of Brazilian wheat to the Arab countries reached US$ 175 million in the first two months this year. In the whole of last year, revenues totalled US$ 37 million, according to the Brazilian Ministry of Development, Industry and Foreign Trade. In January and February 2010, no wheat was shipped from Brazil to the region. All of the wheat shipped this and last year was sold by the state of Rio Grande do Sul.
According to the chairman of the Federation of Agriculture Cooperatives of the State of Rio Grande do Sul (Fecoagro-RS) and of the National Chamber of Winter Cultures, Rui Polidoro Pinto, the hike in wheat prices influenced the increase in sales to the region. This year, the commodity is selling for 35% to 40% more than in 2010. Aside from that, according to Pinto, Arabs eat pita bread, a no-yeast bread to whose manufacturing part of the wheat produced in Brazil – the soft variety – is well-suited.
Out of all the Brazilian wheat sold to the Arab market, US$ 93 million were shipped to the region in February and the remainder in January. The top buyer in the Arab world was Algeria, which spent US$ 80.7 million in wheat from Rio Grande do Sul, followed by Libya, which spent US$ 22 million, Tunisia, US$ 20 million, Egypt, US$ 18 million, and Sudan, US$ 9 million. Syria, Morocco, the Emirates and Yemen have also purchased Brazilian wheat.
The wheat currently being shipped from Brazil is from the last crop, whose harvest ended around October last year. In March, the state of Paraná – the other leading producer of the commodity alongside Rio Grande do Sul – is beginning to plant its next crop. In Rio Grande do Sul, the crop is sown in May and June, according to Pinto. Last year, the Brazilian crop reached 5.6 million tonnes.
Despite not having a sufficient production to meet its domestic consumption, which is 10 million tonnes, Brazil is a wheat-exporting country. Apart from being a strategy for obtaining higher prices, the exports are also meant to ship out the soft wheat, which is abundant in the country and well-suited to biscuit and pita bread production. Thus, on the other hand, the country imports a variety of wheat better suited to bakery.
According to the Fecoagro chairman, however, the country is making an effort to produce more wheat for bakery. Currently, the leading suppliers of wheat to Brazil are Argentina and Uruguay, as well as Canada and Europe. Last year, two wheat-producing countries, Australia and Russia, had problems with their crops, which contributed to the ongoing hike in wheat prices. Although the sizes of these countries’ current crops are not yet known, Pinto believes the prices of the commodity should remain high in 2011.
*Translated by Gabriel Pomerancblum
