LONDON, ENGLAND – The International Grains Council (IGC) has lowered its forecast for 2019-20 global grain production as projected wheat output in the E.U., Russia and Canada as well as corn production in China has declined from the previous month.
In its most recent Grain Market Report, released on July 25, IGC forecast total grain output of 2.148 billion tonnes, down 8 million tonnes from its June report. If realized, 2019-20 grain production would be slightly higher than last year’s total of 2.142 billion tonnes.
Although a heatwave is negatively impacting crops in Russia as well as several major wheat-producing countries in Western Europe, the IGC still forecasts 2019-20 global wheat production at a record 763 million tonnes, up from last year’s total of 733 million tonnes.
The E.U.’s wheat crop is forecast at 148.7 million tonnes, down from 151.2 million tonnes the previous month, and reflects downward revisions in France, Germany, Britain and Poland. Canada’s wheat outturn was cut to 32 million tonnes from 33.6 million, and Russia saw its month-on-month projection fall 3.8 million tonnes to 75.7 million.
Global corn output is forecast 3 million tonnes lower from the previous month at 1.092 billion tonnes, down from 1.130 billion tonnes in 2018-19, while rice production is projected to increase from 499 million tonnes in 2018-19 to 503 tonnes this year.
Meanwhile, overall global grain consumption is forecast to increase year on year (2.165 billion tonnes to 2.184 billion), while carryover stocks are projected to decline from 621 million tonnes to 585 million.
“Because of smaller stocks at the start of the season, overall grain supplies are predicted to be at a four-year low,” The IGC said. “A third successive contraction of global stocks is forecast at the end of 2019-20, with the rate of drawdown accelerating to 36 million tonnes. This entirely reflects tightening corn inventories (down 50 million tonnes year on year), while carryovers of other grains are expected to expand, including wheat (+9 million tonnes) and barley (+3 million tonnes).”
It noted that U.S. corn carryover is projected to shrink by 18 million tonnes from 2018-19, to a six-year low.
Global soybean production in 2019-20 is forecast to drop 4% from the previous year to 348 million tonnes, mainly because of lower production in the U.S.
The IGC said even though the trade war between the U.S. and China had reduced consumption in China, increases in other parts of the world should propel global soybean consumption to a new high of 359 million tonnes. Global soybean trade is projected to fall to 150 million tonnes, a 2% decline year on year.