Global grain feed supply outlook better-than-expected for 2007-08 

Global feed grain supplies are forecast to rise in 2007-08, with coarse grain production expected to be higher than previous estimate, according to the USDA.

Worldwide production of coarse grains in 2007-08 (including corn, barley, oats and sorghum) is forecast to jump by 8 percent, to 1.056 billion tonnes.

In Brazil, coarse grain production is estimated to rise by 5 percent in 2007-08, to 55 million tonnes.

While previous forecasts indicated that Brazilian production would be lower than 2006-07, higher than expected corn yields has contributed to the upwards revision.

In the US, coarse grain production is expected to increase 25 percent compared to the previous year, to 351 million tonnes, driven by forecast increases in barley and sorghum production.

Prices in the US for these two grains remain high, with demand expected to rise in the year, especially for animal feed.

While global usage of coarse grains for feed is forecast to increase in the coming year, usage for feed in Australia is expected to fall 26 percent, to 3.5 million tonnes. This is despite a projected 23 percent rise in Australian coarse grain production, to 13.1 million tonnes, due to improved sorghum yields. Coarse grain exports are expected to rise sharply.

World wheat production is expected to bounce back in 2007-08, increasing 2 percent, to a forecast 605 million tonnes. USDA also forecasts an increase in Australian wheat production in 2007-08 on the back of another drought affected harvest - increasing from 10.64 million tonnes to 13.10 million tonnes.

Increased world wheat production will allow some rebuilding of global wheat stocks, which could lead to a decline in wheat prices for the coming year. Low global stocks meant grain prices are now particularly sensitive to changes in grain production forecasts.