Despite serious weather problems affecting southern hemisphere crops, global grain output shot up 5.65 per cent in 2008 following larger than expected production in the northern hemisphere notably in China, according to the latest findings by the International Grain Council (IGC).
Total output of food grains, including wheat, rice and maize among others, was estimated at 1,788 million tonnes, 101 million tonnes higher than 1,889 million tonnes in 2007.
World carry-out stocks of grains in 2008-09 are placed 31 million tonnes higher than at 338 million tonnes, a significant recovery from the low levels of the last two seasons. World grains trade last year is forecast at 228 million tonnes, 10 million tonnes less than last year. Global economic and financial difficulties are reflected in a 2 million tonne cut in the world trade forecast since November.
Overall wheat output increased by 78 million tonnes to a record 687 million. Harvests in several northern hemisphere producers were better than expected but drought reduced the crop in Argentina, and harvest rains affected quality in Australia, the IGC report said. The production estimate for maize was up by a marginal 1 million tonnes at a record 788 million tonnes. Output in Argentina and Brazil will be lower after hot, dry weather.
Total consumption of foodgrains is forecast to decline by 14 million tonnes to 1,731 million tonnes, reflecting a sharp slowdown in ethanol manufacture in the US and, to a lesser extent, the impact of the global economic downturn on commercial demand for animal feed.
Consumption estimates for wheat is forecast to increase to 648 million tonnes this year from 615 million tonnes in the previous year. While feed use estimates are trimmed, use in this sector is nevertheless forecast to climb by 3.1 per cent to 117 million tonnes. Stocks in the five major exporters are now projected to rise by 20 million tonnes in 2008-09 to 48 million tonnes with big increases in the US and the EU. The trade forecast of wheat is increased by 8 million tonnes to 118 million tonnes.
Demand from Near East Asia is strong because of poor crops while feed importers in Far East Asia are using wheat instead of maize and other more expensive feeds. The poor harvest has considerably reduced Argentina’s export prospects, but EU shipments will be much larger than in 2007-08. Both Russia and Ukraine expect to ship record amounts of wheat, the IGC report said.
Forecast world consumption of maize is reduced by 11 million tonnes to 779 million tonnes mostly because of a slowdown in US ethanol production, while feed use is trimmed in several countries due to competition from wheat. There is consequently a large increase in forecast closing stocks, including a three-year high of 46 million tonnes in the US.
