IGC lowers grains outlook for 2018-19

by Eric Schroeder
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LONDON, ENGLAND — The International Grains Council (IGC) lowered its forecast for total grains production in 2018-19 to 2.077 billion tonnes, down from 2.089 billion tonnes in late May, and down from 2.09 billion tonnes forecast for 2017-18.

Total grains consumption is forecast at 2.131 billion tonnes, down from 2.136 billion tonnes in late May and compared with 2.11 billion tonnes in 2017-18.

The forecast for total grains carryover stocks was lowered to 544 million tonnes, down from 556 million tonnes a month ago and down from 598 million tonnes in 2017-18.

“The total grains supply and demand outlook for 2018-19 has tightened since the last GMR,” the IGC noted in a July 2 report. “A 12-million-tonne cut for world grains production is centered on Russia and the E.U., where adverse weather has harmed prospects for wheat, maize and barley. Although global consumption is reduced, projected carryover stocks are down by 12 million tonnes month over month, with the year-over-year decline now seen at 54 million, including a drop of 34 million in the major exporters.

Corn production in 2018-19 is forecast at 1.052 billion tonnes, down from 1.055 billion tonnes in late May but up from 1.043 billion tonnes in 2017-18. Consumption is forecast at 1.096 billion tonnes, down from 1.098 billion tonnes a month ago and compared with 1.077 billion tonnes in 2017-18.

Global wheat production in 2018-19 is forecast at 737 million tonnes, down from 742 million tonnes in late May and compared with 758 million tonnes forecast for 2017-18. Consumption also was forecast lower, at 743 million tonnes compared with 746 million tonnes a month ago. The IGC forecast 2017-18 global wheat consumption at 738 million tonnes.

Soybean production in 2018-19 is forecast at 358 million tonnes, up from 356 million tonnes in late May and up from 337 million tonnes in 2017-18. Consumption is forecast at 358 million tonnes, up from 356 million tonnes a month ago and 345 million a year ago.

Rice production in 2018-19 is forecast at 491 million tonnes, up narrowly from 490 million tonnes in late May, and up from 488 million tonnes in 2017-18. Rice consumption also is forecast higher, at 493 million tonnes, which compares with 491 million tonnes in late May and 488 million tonnes in 2017-18.

The IGC Grains and Oilseeds Index (GOI) decreased 9%, led by sharp declines in corn, soybeans and wheat, the IGC said.

“While fundamental developments contributed to losses at times, including broadly favorable rowcrop conditions in the U.S., much of the downside was associated with uncertainty about deepening trade tensions across the world, including between the U.S. and China,” the IGC said.

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