IGC forecasts world grains harvest to be second largest on record

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By IAC Staff

The International Grains Council (IGC) has raised its forecast for world total grains (wheat and coarse grains) production in 2017/18 by 19m t m/m (month-on-month), to 2,069m, second only to last season’s record.

The IGC said the estimate was being raised because of higher corn production in Argentina and the United States and wheat numbers from Russia.

“A larger projection for feed outweighs cuts for food and industrial uses and boosts the forecast for total consumption by 7m t, to 2,096m, up a fraction y/y (year-on-year) to a new peak,” the IGC said in its latest report.

It said higher than previously predicted maize inventories in the USA and Argentina account for most of the 12m t boost for end-2017/18 total grains carryover stocks. With increases from before mainly for wheat and maize, the grains trade figure is raised by 5m t m/m.

“With a further upgrade to crop prospects in the USA contrasting with marginal reductions for others, the world soyabean production outlook is lifted to 348m t, 3m below the previous season’s peak,” the IGC said.

The international body maintained its consumption projection at an all-time high, predicting global ending stocks slightly higher m/m, at 42.0m t.

  • World grains production is forecast to be the second largest in history in 2017/18.
  • With a slight fall in supplies and amid strong demand, global stocks of grains could come down for the first time in five years, mostly for maize.
  • A further expansion for maize will likely take world total grains trade to a new all-time high.
  • Despite record plantings, world soyabean production in 2017/18 could fall short of the previous season’s peak on a retreat in yields.
  • Global rice trade may be at fresh highs in both 2017 and 2018, while stocks are seen tightening on reductions in key exporters.

“Nevertheless, this would still represent a y/y drop of 6% amid expectations for a contraction in key exporters, namely Brazil and Argentina. Tied to an upgrade for China, world trade is seen 1m t higher m/m, at a record of 150m, a 4% y/y expansion,” the report added.

Reflecting bigger than anticipated shipments to markets in Asia and Africa, the IGC forecast world rice trade in 2017 0.9m t higher than in August, at a new peak of 42.8m, up by 9% y/y.

Owing to modest downgrades for some Asian producers, the projection of 2017/18 global output is trimmed by 2m t, to 483m, a small annual fall, but still the second-largest outturn on record.

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