Global Markets: Wheat – Southeast Asia Projected as Leading Import Region

Wheat harvest. Photo: Kansas State University

Over the last 10 years, global wheat trade has grown significantly and there has been a gradual shift in the major regions that are importing wheat. Historically, the two regions driving global wheat demand were the Middle East and North Africa. While those regions continue to demand large amounts of wheat, Southeast Asia and Sub-Saharan Africa have seen major growth and are now significant forces in global wheat trade.

All of these regions are consistent importers because production is insufficient to meet consumption. Southeast Asia is the most extreme example as domestic production is almost nonexistent, meeting less than 1 percent of demand requirements. For this region, growth in consumption leads directly to higher import demand.

For 2018/19, Southeast Asia is expected to be the top wheat importing region for the first time, mainly driven by strong demand in Indonesia and the Philippines. Indonesia has more than doubled its imports in the last decade, becoming the world’s second-leading importer after Egypt. Both food and feed demand in that country have skyrocketed in recent years.

Wheat imports for the Philippines have also more than doubled over the last decade, with a large surge occurring in 2018/19. Wheat imports in that year were boosted by reduced supplies of other grains as typhoons cut domestic corn and rice production.

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In 2019/20, Southeast Asia is forecast again to be the world’s top wheat importing region, with Indonesia and the Philippines continuing to be the driving forces. Wheat demand in the region continues to trend higher based on longer-term shifts in consumption from rice to wheat as diets diversify. Additionally, with global wheat supplies projected to be more abundant, relatively lower prices are expected to provide further stimulus to demand for both food and feed uses.

Imports from Russia and Ukraine have grown significantly in recent years. With both of those exporters anticipating bumper crops, those supplies will likely feature prominently in fulfilling regional demand once again.

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