Wheat and meslin flour and cereals market in MERCOSUR

Earlier Report Observations

In 2018, the Argentine government established the Wheat Stabilization Fund (FETA) to set internal reference prices and reduce volatility, providing stability for the flour market in MERCOSUR. The following year, despite the entry of new small-scale mills in Brazil and Argentina, market volume edged down slightly, partly due to rising global wheat prices linked to tensions in Ukraine. The situation shifted sharply in 2020 when the COVID-19 pandemic triggered a surge in demand for long-shelf-life foods like flour, lifting consumption to 12.95 million tons.

In 2021, persistently high international wheat prices increased raw material import costs, contributing to a modest dip in market volume. However, in March 2022, Argentina reactivated FETA to guarantee domestic prices, which, combined with the impact of the full-scale war in Ukraine on global supplies, supported local consumption and drove the market up to 13.07 million tons.

Growth continued in 2023 as the reactivation of the Moinho Maratá milling facility in Brazil added domestic production capacity. Simultaneously, the global trend toward specialized flour, evidenced by product launches in Canada, encouraged MERCOSUR producers to develop premium segments, reinforcing overall market expansion to 13.29 million tons.

Production wheat and meslin flour and cereals in MERCOSUR

In kind, 2017-2020, K t

Top producers of wheat and meslin flour and cereals, 2017-2020

World map of production of wheat and meslin flour and cereals, 2017-2020

In 2020, MERCOSUR produced 13 187 K t of wheat and meslin flour and cereals, showing a small year-over-year increase of 1.6%. Over the period from 2017 to 2020, production grew by 13.7%, with a compound annual growth rate of 4.4%. The largest decline occurred in 2019, at 0.3%, while the largest increase was recorded in 2018, reaching 12.2%.

Annual dynamics of production in MERCOSUR in kind, 2017-2020, K t

In value, 2017-2020, M $ US

MERCOSUR's wheat and meslin flour and cereals production volume increased for the third consecutive year. In 2020, the output was valued at 6 824 M $ US, indicating a significant rise of 31.4% compared to the previous year. Between 2017 and 2020, production increased by 60.3%, equating to an annualized growth rate of 17.0%.

Annual dynamics of production in MERCOSUR in value, 2017-2020, M $ US

Exports wheat and meslin flour and cereals from MERCOSUR

Exports in kind, K t

In 2020, foreign wheat and meslin flour and cereals supplies from MERCOSUR amounted to 445.9 K t, showing an intense reduction of 27.2% compared to 2019. Between 2017 and 2020, exports decreased by 29.7%, with an annualized decline rate of 11.1%. The largest increase was recorded in 2019, at 12.4%.

Annual dynamics of product's exports from MERCOSUR in kind, 2017-2020, K t

Throughout 2017–2020, Bolivia, Venezuela, and Chile formed the core group of markets for exports in kind. Bolivia accounted for 44.5% of exports, Venezuela for 3.1%, and Chile for 2.8%, together representing 50.4% of total flows.

Structure of product's exports in kind by countries, 2017-2020

World map of product's exports from MERCOSUR in kind, 2017-2020

Exports in value, M $ US

In 2020, MERCOSUR's volume of wheat and meslin flour and cereals exports reached 230.8 M $ US, amounting to a decline of 5.9% compared to 2019. The minimum value was recorded in 2018 at 209.7 M $ US, while the maximum value occurred in 2019 at 245.3 M $ US. The largest decline was in 2018 at 9.9%, and the largest increase was in 2019 at 17.0%.

Annual dynamics of product's exports from MERCOSUR in value, 2017-2020, M $ US

Throughout 2017–2020, Bolivia, Venezuela, and Chile remained the main markets for exports in value terms of wheat and meslin flour and cereals from MERCOSUR. Bolivia accounted for 43.7% of exports, Venezuela for 5.3%, and Chile for 2.8%, jointly taking 51.9% of total flows.

Structure of product's exports in value by countries, 2017-2020

World map of product's exports from MERCOSUR in value, 2017-2020

Imports wheat and meslin flour and cereals to MERCOSUR

Imports in kind, K t

In 2020, wheat and meslin flour and cereals shipments to MERCOSUR from abroad totalled 213.1 K t, representing a sudden drop of 33.5% over the past year. Over the period from 2017 to 2020, imports decreased by 37.2%, with a compound annual decline rate of 14.4%. The largest increase was recorded in 2019, at 4.2%.

Annual dynamics of product's imports to MERCOSUR in kind, 2017-2020, K t

In 2017–2020, Italy was the core market for imports in kind, accounting for 1.1% of total flows.

Structure of product's imports in kind by countries, 2017-2020

World map of product's imports to MERCOSUR in kind, 2017-2020

Imports in value, M $ US

In 2020, wheat and meslin flour and cereals volumes in MERCOSUR stood at 102.1 M $ US, reflecting a sharp decline of 30.1% relative to the prior year. Over the period from 2017 to 2020, imports decreased by 30.4%, with a compound annual decline rate of 11.4%. The largest increase was recorded in 2019, at 5.6%.

Annual dynamics of product's imports to MERCOSUR in value, 2017-2020, M $ US

In 2017–2020, Italy and France stood out among suppliers of wheat and meslin flour and cereals to MERCOSUR, jointly taking 3.0% of total imports in value terms.

Structure of product's imports in value by countries, 2017-2020

World map of product's imports to MERCOSUR in value, 2017-2020