IGC revises up world wheat, corn output forecast; India likely to post bumper production

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Total grain production in the 2018/19 marketing year will be 10 million tonnes higher than expected, and global stocks 6 million tonnes more than previously anticipated, as wheat production is expected to rise globally, according to the International Grains Council (IGC).

Total wheat production is expected to be 737 million tonnes this year, 8 million tonnes higher than previously thought, but down 30 million tonnes on the year. Meanwhile, consumption is expected to rise by 6 million tonnes on the year to 745 million tonnes, which will be 4 million tonnes higher than the previous year.

The IGC pegged world corn production this year at 1.076 billion tonnes, which would be up by 4 million from an earlier estimate and 29 million tonnes above the year-ago level. However, the world corn carryout is expected to tighten to 271 million tonnes, from 304 million in 2017/18, due to increased consumption.

IGC has lowered world soybean production estimate for the year by 4 million tonnes, to 363 million, with hot and dry weather cutting into Brazilian yields behind the revision. However, total world production is still expected to be about 22 million tonnes above the previous year’s level, with projected world ending stocks also rising.

Uncertainty over Chinese demand kept some caution in the market, as exports from the United States may not be able to see much increase even if some sort of agreement is reached.

Meanwhile, India’s wheat production might cross 100 million tonnes, an all-time high level, in the current rabi season, helped by good weather conditions during winter, a senior government official said, PTI reported.

Wheat production in India stood at record 99.70 million tonne in the 2017-18 crop year (July-June). Wheat output is expected to rise despite fall of around 8 lakh hectare in wheat area to 296 lakh hectare so far this rabi season.

The government of India (GoI) had increased the minimum support price (MSP) of wheat to Rs 1,840 per quintal from Rs 1,735 per quintal, as part of its decision to fix the support price at least 1.5 times of the production cost.

Shekhar Ghosh is consulting editor, Indoasiancommodities.com. He has edited and written for publications like Business India, Business Standard, Business Today, Outlook and many other international publications. He can be reached at shekhar.ghosh@indoasiancommodities.in.

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