RATIN

World grain production to hit three-year low, IGC

Posted on December, 6, 2018 at 10:39 am


By Susan Reidy

PARIS, FRANCE — World total grains production is forecast to hit a three-year low, falling short of demand and keeping global trade strong, the International Grains Council said following its 48th Council Session on Dec. 4 in Paris, France.

IGC members assessed the latest supply and demand outlook and market developments for grains, rice and oilseeds as well as recent changes in national policies and administrative matters.

At a three-year low of 2.079 billion tonnes, world total grains (wheat and coarse grains) production was forecast to be down by 24 million tonnes year-on-year, as an improved maize harvest was seen being outweighed by reductions for other crops.

As grains production was again expected to be outstripped by demand, the IGC predicts a second consecutive season of world stock depletion.

Global trade was predicted to stay strong, including record shipments of maize and barley.

The IGC’s first projection for all-wheat harvested area in 2019-20 was for a rise of about 1%, the first increase in four seasons.

Although gains were anticipated in the E.U., Russia, the United States and India, inclement weather in the early part of the season was of some concern.

Global rice production in 2018-19 was projected broadly steady year-on-year, at 491 million tonnes, as a likely policy-driven fall in China was expected to be offset by increases elsewhere in Asia. With consumption seen rising to a new high, carryover stocks were expected to tighten, including in China. Trade was anticipated at a record, including larger deliveries to Africa.

With bigger or record crops in key producers, world soybean output in 2018-19 was forecast to be up by 8% year-on-year, to a peak of 367 million tonnes.

Despite an expected slowdown in China, global consumption growth was likely to quicken on notable gains elsewhere. Tied to accumulation in the United States, world inventories were predicted to expand by some 30%, to a high of 51 million tonnes. Reflecting the trade dispute with the United States, shipments to China were projected to fall by 5%, but would be offset by bigger deliveries to other markets, leaving world trade unchanged.

The IGC Grains and Oilseeds Index (GOI) was little changed. Tighter supply outlooks were helping to keep average wheat, maize and barley export prices above year earlier levels. However, in a period of volatile movements, soybean values were sharply down, led by a drop in the United States, where quotations were pressured by heavy supplies and subdued exports.

World markets for white and parboiled rice were modestly weaker on generally comfortable availabilities and sluggish international demand.

IGC members also approved the organization of a joint seminar with GAFTA on Africa in January 2019, and to the signing of an agreement with the International Grain Trade Coalition (IGTC).

Gary Martin, president of the IGTC, provided an update on current developments in policy and trade practice.

The IGC received statements from the OECD and WTO on recent developments, and welcomed representatives from the FAO, GEOGLAM and WFP. The IGC also welcomed the participation of Brazil and Taipei (Chinese) Separate Customs Territory as observers.

Source: WORLD-GRAIN.COM