Record wheat and barley harvests seen lifting world grains output by 40 million tonnes in 2019/20

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IAC photo by Parivartan Sharma

Record harvests of wheat and barley are expected to outweigh a poorer maize crop to lift world total grains — wheat and coarse grains — production by 40m t in 2019/20, to 2,177m, only modestly below the all-time peak in 2016/17, the International Grains Council (IGC) said in its latest monthly report.

Consumption is forecast to climb by 1%, as growth for food and feed more than offset lower industrial usage, it said, adding that only a small stock drawdown of total grains is envisaged, with accumulations of wheat, barley and rye almost enough to compensate for another sizeable decline of maize inventories.

“Record trade is forecast, including increased shipments of wheat, maize, barley and sorghum,” the report pointed out.

It said world total grains production in 2020/21 is projected at an all-time high of 2,230m t (+54m y/y), including record harvests of wheat (+4m) and maize (+50m).

Consumption is seen reaching a new peak, with larger food and feed usage as well as a recovery in industrial demand. The first rise in global stocks for four seasons is predicted, to 627m t (+13m y/y), as the fourth successive drop in maize carryovers is outweighed by gains for other grains, the report said.

A 12th consecutive annual rise in maize shipments is largely behind projected 2% growth in world grains trade, to a new high of 387m t,” it added.

According to the report, despite a record Brazilian harvest, global output in 2019/20 is seen down by 7% y/y on a heavily reduced US crop, along with smaller outturns in Argentina, Canada and India.

“With consumption edging up, stocks are set to tighten sharply, mostly on a sizeable contraction in the US. Trade is seen up by 1% y/y, as bigger shipments to China more than offset reduced demand from other buyers. Given prospects for a much larger US crop, 2020/21 global production is predicted to rise by 8% y/y, to 363m t.,” the report said.

While consumption is likely to climb to a new peak, carryovers are seen a fraction higher y/y, at 42m t and nominal accumulation in China is seen offsetting falls elsewhere, it said, adding with another increase in China’s purchases anticipated, world trade is projected to expand by 4% y/y.

With record production in India contrasting with smaller crops elsewhere, global rice output is estimated steady y/y in 2019/20. While the full impact of COVID-19 on demand patterns remains uncertain, the Council expects total use to rise on population growth.

Amid heavy supplies, stocks are forecast to climb to a new high on gains in China and major exporters, while trade in 2020 is seen steady y/y, the report said.

Tied to anticipated acreage increases in Asia, the 2020/21 world rice outturn is predicted at a peak of 506m t, up 9m y/y, with accumulation in key exporters pushing up global carryovers to a record of 182m, it added.

A recovery in African demand could boost trade by 4% y/y in 2021.

Prashant has worked in the publishing industry for 17 years. His keen interest in commodities developed while working for organisations such as like Thomson Reuters, Wolters Kluwer & McGraw-Hill eventually brought him here. In his free time, Prashant consults with businesses in the digital space.

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