Grains News, 15th / Aug / 2024

The grain harvests that are nearing completion in the northern hemisphere have filled the silo warehouses. In the surplus regions, the supply for sale is increasing, while in the surplus regions there is still a reluctance to cover future demand. Accordingly, the market prices for wheat fell by almost 15 €/t in week 33 and broke through the previous resistance line of 215 €/t to the downside. On the leading Chicago exchange, the increased US harvest and stocks are playing a decisive role in the price.

The smaller wheat harvests in Russia, Ukraine and the EU-27 are hardly playing a significant role for the time being. This will only become noticeable later in the year. The global maize harvest will also be smaller The global supply situation in 2024/25 is expected to be weaker than in previous years.

Below is the latest information from the USDA report:

USA: The almost completed wheat harvest is classified at only 53.9 million tons. Compared to the previous year's result of 49.3 million tons, however, this is a considerable increase. In contrast, the barley harvest fell from over 4 million tons to 3.2 million tons. The recently somewhat weaker stock assessments for the remaining maize harvest are estimated at around 385 million tons (previous year: 390 million tons) despite the smaller area under cultivation.

Canada: The 2024 wheat harvest is estimated at 35 million tons (previous year: 32.5 million tons). Barley and maize remain below the previous year at -2 to -3 %. Drought has dampened expectations in a third of agricultural regions

Russia: The comparatively early 2024 wheat harvest is currently estimated at around 83 million tons (previous year: 91.5 million tons). Exports are currently being hampered by the import ban imposed by Turkey until mid-Oct. 24. Exports for 2024/25 as a whole are expected to fall from the previous year's 55.5 million tons to 48 million tons of wheat. In the case of barley and corn, a harvest decline of -7 to -9 % is expected. Exports are usually increased before the onset of winter, so that the smaller harvests will have little impact on prices for the time being.

Ukraine: Contrary to earlier, less favorable expectations, the wheat harvest is estimated at 21.6 million tons (previous year: 22 million tons). The maize harvest is also reduced to 27.2 million tons compared to the previous year's 32.5 million tons; exports are forecast to remain unchanged at 24 million tons. The barley harvest will be -15% smaller at 5.3 million tons.

China: The USDA expects maize, wheat and rice harvests to rise by between +1 and +2 %. Reduced wheat imports of 12 million tons and unchanged corn imports of 22 million tons are forecast to cover demand.

India: Wheat harvests increase by 3%, rice production by only 1%, barley falls by -10%. Wheat and maize imports are hovering around zero, while rice exports are forecast to rise to 18 million tons.

Australia: Higher acreage (+10%) and favorable rainfall in the southeast of the country mean that the wheat harvest is expected to rise by 15% to 30 million tonnes in the months of Nov./Dec. 23024 . Of this, an increasing 23 million tons are to be exported. In Western Australia, however, the outlook is less favorable.

EU-27: The USDA cuts the wheat harvest to only 128 million tons and corn production to 60.5 million tons. The total harvest amounts to 268.6 million tons. In wheat trade, imports of quality wheat are forecast to rise by 11 million tons and exports of wheat to fall by 34 million tons. In the case of maize, imports are expected to remain unchanged at 18 million tons, with a focus on Spain and north-western processing regions. Quality losses have been added to the yield reductions.

Overall, the multi-year decline in the global supply situation will continue in 2024/25. The benchmark is the falling 25.5 % final stock measured against consumption. This corresponds to the 2014/15 level.