Fragile global grain situation may change buying

by Emily Wilson
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A further reduction in world wheat production in 2001-02 was forecast by the International Grains Council in its June grain market report. The Council places this year’s global wheat crop at 570 million tonnes, down 7 million from its forecast a month ago.

Such an outturn would be off 12 million tonnes, or 2%, from the previous year. Decreases from last year were centered in Europe, the United States, India and Turkey.

In contrast to the smaller harvest, the IGC projected a rise in world trade to 103 million tonnes, up 2 million from 2000-01 and a gain in world wheat consumption, to 599 million tonnes.

This prompted the IGC to observe, "The increasing fragility of the world grain supply-demand balance could be expected to push up prices in 2001-02." The Council said this might prompt some major importers to stop purchasing on a replacement basis and "cover the requirements further ahead."