September 4, 2013

 

Record-high grain crops to boost global reserves

 

 

In some regions of the world, grain productions hit record high which are expected to boost global reserves.

 

According to the latest market review by German grain trader Toepfer International, harvest results from winter crops in the US, Europe and North Africa have confirmed good yields.

 

A record wheat crop of 705 million tonnes, record corn harvest of 957 million tonnes and the best barley production in four years of 140 million tonnes have filled the world's storages.

 

"Of the world's 10 biggest corn producers, eight countries should achieve record harvests this year," the company said.

 

Last month's forecasts by the USDA indicate global production of all grains in 2013-14 will hit 2.43 billion tonnes, exceeding the previous record of 2.32 billion tonnes set two years ago.

 

The global harvested area of 703 million hectares is also a new record.

 

Toepfer said a big increase in wheat production was particularly noticeable in Russia, the Ukraine and Kazakhstan, where good sowing conditions last autumn and a relatively mild winter created the perfect growing environment in spring. Wheat-crop estimates for the three countries are 52.1-54 million tonnes.

 

"This means that wheat production in these three countries is expected to increase by around 28 million tonnes in comparison to the previous year," the grain trader said.

 

Toepfer said the EU wheat crop, including durum production, was tipped to be 142-143 million tonnes.

 

"After the long winter and the late start to plant growth, growing conditions for winter grain have been almost perfect since April in most of the EU's growing areas," it said.

 

"The heat wave, which started in the second half of July in northwest Europe, should only have affected kernel filling in wheat in a small number of regions. In southern Europe, where the harvest is now complete, yields were consistently well above average, even at a record level in some areas. The current results in France, Germany and Poland also show that yields will be above the long-term average."

 

Dry conditions in some areas of the US during the past two weeks have lifted prices for soy, corn and, to a lesser degree, wheat.

 

The Chicago Board of Trade corn futures last week were trading about 10% higher than they were four weeks ago. CBOT wheat prices have sat around US$260-US$268/ tonne for the past few weeks and, according to CBA Agri Commodities, are at the five-year average.