Harvested corn in China. Photo: Rabobank

THE WORLD total grains harvest in 2019/20 is expected to be the second largest ever, at 2170 million tonnes (Mt), 1 per cent greater than the previous year, with bigger wheat and barley crops offsetting a reduced maize outturn, according to the International Grains Council (IGC) January 2020 market report.

The maize production forecast nonetheless was lifted 8Mt in the January report compared with the previous November 2019 forecast, with US and China maize-production figures were lifted by 3Mt and 5Mt respectively.

Grains consumption is expected to climb by 1pc to a new peak, including advances for food, feed and industrial purposes.

As the rise in demand outstrips the gain in supply, global stocks are seen contracting for the third consecutive year to a four-season low of 599Mt.

The year-on-year drawdown is entirely for maize, while rebuilding of inventories is envisaged for wheat and barley.

At 377Mt, total trade in grains is seen at 4pc higher than last year, and at a fresh high, including the eleventh successive expansion of maize shipments.

The trade projection this month was also boosted by 2Mt, mostly linked to larger-than-predicted wheat imports by Iran and Turkey.

Changes to grains use only absorb part of the supply gain, and the January forecast for global stocks has been lifted by 5Mt to 599Mt.

Stock in 2018/19 was 624Mt.

Table 1: Total wheat and coarse grains supply and demand with figures in million tonnes. Higher usage in all categories, food, feed and industrial is boosting trade and cutting stocks. Source: IGC

Price peak

Led by strong gains in wheat, maize and rice export prices, the IGC Grains and Oilseeds Index (GOI) reached its highest since October 2018, up by 4pc compared with the November report, and 2pc year-on-year.

The IGC GOI wheat sub-index rose by 9pc to an 11-month peak, lifted by solid export demand, confirmation of a small Australian crop and concerns about less-than-ideal conditions for 2020/21 crops in parts of the EU and the Black Sea region.

Source: IGC

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