March 15, 2012

 

Global corn production up in 2012/13 on a down consumption

 

 

As demand for meat boosts feed use, world corn production should climb in 2012/13 but is likely to remain below consumption, International Grains Council senior economist Amy Reynolds said on Wednesday (Mar 14).

 

Reynolds, in a presentation at the Agra Europe outlook conference, put the 2012/13 global corn crop at 880 million tonnes, up from 864 million in the prior season.

 

Global consumption was seen rising to 884 million from 871 million with the increase driven mainly by higher feed use of 502 million, up from the prior season's 490 million.

 

"Rising demand for meat, especially in parts of Asia, Latin America and Africa, will help to drive increased use of feed," Reynolds said.

 

Reynolds said the figures for corn were provisional and would be firmed up in the monthly report due out later this month. The IGC produced its first 2012/13 supply demand balance for wheat in last month's report.

 

"On the basis of these provisional figures the outlook for corn is certainly less comfortable than for wheat," she said.

 

Reynolds said she expected global corn plantings to rise by around 1%, driven by increased area in both the US and Ukraine.

 

"Any increase in (corn) supply will be absorbed by greater use," she said.

 

The USDA, at its Outlook conference last month, projected that US farmers would plant 94.0 million acres of corn (corn) this spring, the largest area since World War Two and up from 91.9 million last year.

 

But its more authoritative forecast, the annual prospective plantings report that is based on farmer surveys, will be released on March 30.

 

Ukraine plans to boost its area sown for corn to 4.5-5.0 million hectares in 2012 from 3.6 million in 2011 after drought and severe frosts damaged about three million hectares sown for winter grains. Ukrainian analyst ProAgro this week raised its forecast for the 2012 corn production by 20% to 21.3 million tonnes from the previous estimate of 17.7 million tonnes.

 

A jump in the harvest could see Ukraine surpass Argentina as the world's second largest corn exporter. The US is by far the world largest corn exporter.

 

Reynolds said the 2012/13 global wheat crop was seen falling by about 15 million tonnes to 680 million tonnes but total supply is to remain around the previous season's levels, boosted by higher opening stocks.

 

"We are anticipating (wheat) inventories in the major exporters to remain ample," she said.