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price environment and matters of interest to US and globally. However, another topic that was discussed by not only Mr Johansson but by most speakers throughout the day was China, and how the country’s growth has declined and the issues that this new situation was creating in countries that export to Asia. Although China is still a major contributor to global markets, USA and Canada are expected to make a comeback and be reinstated to the summit of world grain producers in the not too distant future. As for the immediate future, the US is expected to remain number one exporter of corn and cotton, although recently there has been, “a move away from US corn to other commodities and increase in corn imports from China to countries like Ukraine,” according to Dr Johansson. Further evidence of this can be found in the with the 10 year US corn export projections, which start to “tail off mostly due to South American exports.” According to USDA predictions, soybean production will remain high, as consumption catches up for corn and soybeans. However, global demand will be outstripping production in 2016/17 whilst global ending stocks edge up. One consideration offered by Dr Johansson, is the Chinese policy of builds stocks, which has been pushing up their stakeholding, even with this the Chinese market, “still continuing to import a lot of soybeans.” With the market appearing to offer little consolation for producers, in the short term at least, how will they cope with low

incomes? Well according to Dr Johansson, cost per hectare is a “key consideration.” He also added that producers may also, “cut back on machinery purchases and repair” and they may be much more reserved with their overhead costs. However, another aspect of the current situation is that overall farm debt will continue to increase, whilst delinquency rates on farm loans will go up slightly with cash rental rates falling, but only slowly, Dr Johansson added. This in turn will see a continued growth of Crop insurance schemes in the US, as well as “Higher prices for corn being driven by a lower price of soybean meal.” Dr Johansson concluded his address by stating that the low price environment expected to continue “at least in near term,” whilst US plantings will be driven by “producers decisions on which crop will produce the best returns” (or lowest losses). Mr Jens Schaps, EU grains supply and demand outlook Following Dr Johansson’s address, the next speaker to address the assembled delegates was Mr Jens Schaps, Director for Agricultural Markets, Directorate-General for Agriculture and Rural Development of the European Commission, EU. Mr Jens Schaps has worked for the commission of the European Union since 1983. All of which makes him the prefect choice to discuss his chosen topic “EU grains supply and demand outlook.” In his address, Mr Schaps began by discussing how the international grains market was “a living sector,” with “grains all over the world,” adding that in recent years, “the industry

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JUL 2016 - Milling and Grain magazine