July 4, 2005

 

High 2005-06 coarse grains output expected

 

 

A high coarse grains crop output is expected in 2005-06, although the forecast of 962 million tonnes remains below last year's record of 1.01 billion, the International Grains Council (IGC) said on Jun 30.

 

In its latest grain market report, IGC also predicted that world coarse grains consumption would decrease slightly in 2005-06 to 963 million tonnes, which would match forecast output and is comparable with last year's consumption of 964 million.

 

If production and consumption forecasts were realised, world coarse grains carryover stocks would remain largely unchanged at 176 million tonnes from 177 million tonnes in 2004-05. Coarse grains trading is expected to increase by 2 million tonnes to reach 103.7 million in 2005-06, mainly from higher corn shipments.

 

The corn crop outlook had improved since May, especially in Mexico and Argentina, and stocks of corn are likely to increase again.

 

Corn production is expected to decline by about 5 percent to 673.7 million tonnes from last year's record, due to reduced yields in the US and smaller crops in the EU and Commonwealth of Independent States. However, the total is somewhat higher than the forecast from a month ago, with estimates increased for Argentina and Mexico.

 

World corn consumption is expected to shadow last year's level, while corn trade is likely to rise to 77.9 million tonnes from 76.1 million in 2004-05, mainly due to Brazil's crop shortfall and a possible minor increase of corn trading in East Asia.

 

Global corn carry-over stocks should rise for the second successive year by about 5 million tonnes, IGC said.

 

For wheat, global production is predicted to reach 604 million tonnes, unchanged from the council's estimate a month ago. IGC also lowered forecasts for Australia, Canada and India while upping them for Russia, Ukraine and China.

 

World wheat consumption is forecast at 608 million tonnes in 2005-06, down 4 million tonnes from 2004-05 owing to reduced global feed use. Still, consumption is expected to exceed production.

 

This figure has been revised up 1 million tonnes from last month's estimate as feed use in the EU is expected to be higher, especially in drought-stricken Spain.

 

Increased imports to North Africa, the Middle East and South America are expected to lift world wheat trade to 107.6 million tonnes, where in 2004-05 this was 105.6 million tonnes.

 

If realised, 2005-06 wheat trade would reach a five-year record high.

 

Stocks of wheat at end 2005-06 are expected to stand at 133 million tonnes, little changed from IGC's previous estimate, but down from the previous year's 137 million tonnes.