World grain stocks to end 2013-14 at four-year top

by Agrimoney.com

The International Grains Council raised to a four-year high its forecast for grain supplies at the close of next season, flagging increased prospects for corn production despite the delayed US sowing season.

The intergovernmental group lifted by 6m tonnes to 367m tonnes its forecast for world grain inventories at the close of 2013-14, surpassing levels recorded at the ends of 2010-11 and 2011-12.

The increase reflected an upgraded forecast for the world corn harvest, by 6m tonnes to a record 945m tonnes, despite the historically slow start to plantings in the US, the top producer of the grain - delays which prompted the US Department of Agriculture to trim hopes for domestic yields.

The US is placed for a "still bumper" harvest of corn, and of soybeans too, the IGC said, adding that this remained a "mild underlying bearish influence" for prices of both crops.

World carryout inventories of corn in 2013-14 will, at a five-year high of 149m tonnes, "be much more comfortable compared to the previous year, especially in the US, where stocks are expected to more than double".

'Ample supplies'

The IGC sounded a more cautious note on the outlook for the world wheat harvest in 2013-14, flagging that "there is continued uncertainty about harvest prospects in some major producers".

Nonetheless, it raised by 2m tonnes to 682m tonnes its forecast for the harvest, which has already begun in some areas, such as north Africa.

And while the council trimmed by 1m tonnes to 180m tonnes its forecast for world wheat inventories at the close of 2013-14, nudging hopes for consumption higher, it said that "wheat availabilities are still set to be ample over the year ahead".

"Trade in [wheat] feed is expected to be capped by higher corn supplies," the IGC added.

Soybean prospects

In soybeans, the council, noting that "a record crop is officially forecast for the US on a rebound in yields", lifted by 2m tonnes to 267m tonnes its forecast for the world harvest.

However, upgrading demand ideas, it kept its estimate for stocks at the close of 2013-14 at 25m tonnes, a rise of 2m tonnes year on year.

See the original article >>