July 2024: USDA estimates world grain production and consumption higher in 2024/25, but stocks lower
In its latest July issue, the US Department of Agriculture (USDA) slightly increased the global grain harvest in 2024/25 compared to the previous month's estimate. Compared to the previous year, the rates of increase in production and consumption are around 0.8 %. Nevertheless, the even higher consumption estimate leads to a -0.6% decline in stocks. The supply figure falls to 25.7% of final stocks to consumption. This is the lowest level since 2015/16.
In the case of the wheat market, the USDA has increased its harvest estimate by 6 and 7 million tons compared to the previous month and year to the current 796 million tons. Significant contributions came from the USA, Canada, Argentina, Pakistan and Australia. In contrast, the cuts for Russia, Ukraine and the UK were confirmed with minor changes.
Wheat consumption was increased to around 800 million tons. This means that global final stocks will fall from last year's 261 million tons to 257 million tons, the lowest level in 8 years.
The USDA estimates the global maize harvest at 1,225 million tons, little changed from the previous year. Smaller yields in Russia, Ukraine and China are largely offset by rising production in Brazil, Argentina and South Africa. Global maize consumption is also expected to change only marginally. Stocks are estimated to be slightly higher.
The USDA estimate confirms a global supply situation on the grain market that has been steadily tightening for several years. Weather-related influences such as drought and flooding have contributed to this, as have the war in Ukraine and government intervention in the market. Against the backdrop of future disruptive factors, the reduced inventories further restrict the scope for action on the market, with the result that market prices react very sensitively to changes. The price fluctuations of recent weeks underline this assessment.
