February 24, 2012

 

IGC expects record global wheat, corn output

 

 

The end of the 2011/12 season might see the breaking of a global wheat stocks record set more than a decade ago, as the International Grains Council raised its forecast for production to an all-time high on Thursday (Feb 24).

 

The IGC, in a monthly update, increased its forecast for world wheat production by five million tonnes to a record 695 million, partly reflecting higher estimates for Kazakhstan, India and Australia.

 

"Even though total consumption is growing at a faster than average pace, world stocks are projected to rise to 211 million tonnes, eclipsing the previous record in 1999/2000," it said.

 

Wheat production in Kazakhstan was projected at 22.7 million tonnes, up from a previous forecast of 22.0 million and more than doubles the prior season's 10 million.

 

The IGC said feed use of wheat would total 131 million tonnes, the most since the early 1990s, boosted by attractive prices compared to corn.

 

Projected food and industrial demand for wheat were revised lower in the latest report which left global consumption in 2011/12 at 681 million, up from the prior season's 656 million.

 

The IGC also said world wheat area is expected to expand by 1.5% for the 2012/13 harvest, including gains in North America and the former Soviet Union.

 

"While crops are mostly developing well in the northern hemisphere, dryness continues to raise concerns about prospects in parts of the US and Ukraine," the IGC said.

 

"The average yield may not match the previous year's high and global production is therefore projected to fall by 15 million tonnes to 680 million," it added.

 

The IGC also raised its forecast for the global corn crop in 2011/12 by 3 million tonnes to 864 million.

 

The most significant upward revisions were for Ukraine and Brazil while the outlook for the crop in Argentina was cut.

 

"A severe drought has reduced yield prospects in South America, especially in Argentina, but Brazil remains on track to produce a record crop," the IGC said.

 

The IGC forecast global corn area this year would rise by 0.6% to a record 167 million hectares, noting plantings would soon commence in the northern hemisphere.

 

Iran's grain imports in 2011/12 were upwardly revised to 5.2 million tonnes from a previous forecast of 4.5 million tonnes and the prior season's 4.2 million.

 

Iran ramped up wheat purchases on international markets this week, taking the total bought this month to almost two million tonnes as the Islamic republic scrambled to sidestep western sanctions aimed at thwarting its nuclear ambitions.