USDA revises world grain harvest downwards - supply situation tighter
In its latest Oct. 24 issue, the US Department of Agriculture downgraded world grain production to 2,294 million tons, lower than in the previous month. In contrast, the consumption estimate of 2,313 million tons, or +0.9% compared to the previous year, was even higher. As a result, ending stocks fell from last year's 609 million tons to this year's 590 million tons. The price-determining supply figure falls from 26.6% to 25.5% final stocks to consumption in the current year.
The supply situation in the wheat sectoris determined by a reduced harvest of 794 million tons (previous month 797 million tons), while consumption was only reduced by around 2 million tons to 802 million tons. Ending stocks fell from 266.2 million tons in the previous year to 257.7 million tons.
The EU-27, with a reduction of just under -12 million tons, Russia with -9.5 million tons, Kazakhstan with -4 million tons and the UK with -3 million tons are the main contributors to the reduction in global wheat production.
This contrasts with higher harvests in China (+3.5 million tons), India (+2 million tons), Pakistan (+3 million tons), Canada (+2 million tons), Australia (+6 million tons), Argentina (+2 million tons) and the USA (+4.5 million tons).
Global wheat trade is expected to fall from 224 million tons to just under 216 million tons. Exports from Russia (-7.5 million tons) and the EU-27 (-7.8 million tons) are expected to suffer particularly severe restrictions, which can only be partially offset by increased exports from the USA, Canada, Argentina and Australia. Several major importing countries such as Egypt, Algeria and others are holding back on imports. Particularly striking is the greatly reduced buying interest in EU wheat in favor of supplies from the Black Sea region.
Global maize production is estimated at only 1,217 million tons (previous year: 1,226 million tons). Consumption is expected to increase by +6 million tons to 1,223 million tons. This means that stocks will have to be reduced from last year's 312.6 million tons to this year's 306.5 million tons.
Smaller maize harvests are estimated mainly in Ukraine (-6 million tons) and Russia (-3.5 million tons). In the world's largest corn-growing region, the USA (-3 million tons), production will fall to 386 million tons.
By contrast, production in Brazil is expected to increase by +5 million tons to 127 million tons, in South Africa by +4 million tons and in China by +3 million tons.
Global maize trade will fall by -6 million tons to 190 million tons, with Ukraine and Russia particularly affected at -5 million tons and 3 million tons respectively. The increase in exports from the South American countries Brazil (+4 million tons) and Argentina (+4.5 million tons) compensated for this.
Although the harvest of the remaining types of grain was +2.6% higher at 283 million tons, this was largely offset by the increase in consumption to 278 million tons.
Grain prices have bottomed out and are establishing themselves at a higher level with some fluctuations.
