Shrimp Industry Demands More Feed Wheat in Ecuador
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Ecuador’s Wheat production in marketing year (MY) 2023/24 (July-June) is forecast to remain slightly over 14,000 metric tons (MT). Wheat production in Ecuador is insignificant, with less than 7,000 hectares. The milling industry in Ecuador is entirely dependent on imports. The Government of Ecuador (GOE) has recently reduced work on developing and distributing local Wheat varieties among small farmers but has increased support for other grains like barley for the local beer industry.
The Ecuadorian milling industry continues to support a Wheat program, with an average of 4,600 to 5,000 hectares (ha) planted under the project per year. This program buys approximately 41 percent of local production from nearly 400 small farmers. With help from government and industry projects, some small farmers have increased their yields from 0.7 MT/ha up to 2.20 MT/ha in recent years, with a slight reduction during the last year due to higher costs of fertilizers. In 2022, the price of urea in Ecuador doubled, going from $27 in 2019 to $55 per 100-pound bag. In calendar year (CY) 2022, Wheat production ranked 28th in planted acreage out of the 40 principal crops produced in Ecuador. In 2021, it ranked 21st.
Wheat is increasingly used by the animal feed sector, mainly in shrimp feed, where it is used as a binding agent. Consumption has also recently ticked higher due to increased consumption of pasta and bakery products. Wheat consumption in MY 2023/24 is forecast at 1.7 million metric tons (MMT), a seven percent increase in demand over the previous year. Ecuador’s shrimp industry has forecast its growth rate for CY 2023 at 10 percent. Although strong, this is down from recent average annual growth rates hovering around 20 percent.
Wheat consumption in Ecuador is almost equally divided between feed (49 percent) and human consumption (51 percent). For Wheat destined for human consumption, 43 percent is for pasta production and 57 percent for bread and bakery. Wheat as feed is used for the shrimp, pork, and poultry industries. Ecuadorian per capita Wheat human consumption in MY 2023/24 is estimated at 46 kilograms/year. In MY 2023/24, the pasta and bakery industries expect consumption to continue increasing thanks to strong advertising campaigns.
Wheat Trade in Ecuador
Wheat imports in MY 2023/24 are forecast at a record of nearly 1.7 MMT, up 111,000 MT from the previous year. Until 2015, Ecuador utilized imported Wheat primarily in bread and pasta manufacturing. Ecuador has incorporated more Wheat into animal feeds, fueled mainly by shrimp production; 69 percent of imported Wheat for feed goes to the shrimp industry. This estimate assumes that demand by the country’s animal feed industry will continue to increase.
During CY 2022, Ecuador diversified its Wheat supply, bringing products from nontraditional origins. Canada remains the principal supplier with 46 percent of the market share, a reduction of 20 percent compared with the previous year, followed by Argentina with 22 percent, and in third place, the United States with 21 percent. The United States Wheat exports to Ecuador increased 55 percent in CY 2022, reaching $112.4 million. Overall average imported Wheat prices increased during CY 2022 to just over $430 per MT.
The U.S. Wheat was the second option after Canadian Wheat in recent years, primarily due to logistical issues and higher prices. However, more competitive prices and availability of Argentine Wheat drove more of its use by Ecuadorian importers and mills. Other Wheat suppliers included Russia, Chile, and Brazil. However, according to the AgFlow data, the U.S. led Ecuador’s Wheat market with 62,435 tons in Jan-Apr 2023, followed by Canada (57,750 tons) and Brazil
Other sources: USDA
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