Despite large upward revisions in China’s wheat stocks estimates, the global wheat supply situation is expected to tighten in 2001-02, according to the latest International Grains Council market report.
Following significant increases to data for China, the IGC raised its estimate of 2001-02 world wheat ending stocks by 28 million tonnes from the previous report, to 122 million. But stocks still will be down some 16% from the revised 145-million-tonne level expected at the end of the current marketing year.
More significantly, wheat stocks held at the end of 2001-02 by the five major exporters — Argentina, Australia, Canada, the European Union and the United States — are projected to decline by 9 million tonnes from 2000-01 to 37 million.
The IGC said its revisions to China’s stocks estimates were based on recent official statements that indicated stocks were well above earlier indications by various outside sources. The IGC increases followed similar upward revisions made by the U.S. Department of Agriculture in its May grain reports.
Even though China may hold more wheat than thought earlier, a combination of smaller global production and increased global consumption will eat away at wheat surpluses, the Council’s report indicated. For instance, at 577 million tonnes, the IGC forecast for world wheat production in 2001-02 is 4 million below the outturn in 2000-01.
Smaller harvests are projected in the E.U., the U.S., India, Pakistan and Turkey. These declines are only partly attributable to lower sown areas and result mostly from prolonged periods of unfavorable weather.
In contrast, a combination of increased sowings and good growing conditions should boost output in Hungary, Romania, Russia, Ukraine, Argentina, Syria, North Africa and Australia, the IGC said.
World trade is forecast at 103 million tonnes, 1 million more than in 2000-01.
Better prospects for domestic output should reduce Russia’s import requirements, but China’s purchases of higher quality wheat could increase. On a regional basis, some upturn is expected in both the Pacific and South Asia based on a combination of fluctuating output and further demand growth.