In its latest World Agricultural Supply and Demand (WASDE) report, the US Department of Agriculture said global grain stocks would continue to increase during the current production year.
The report raised last month’s estimated global grain supply by 8m tonnes. With total use expected to grow by only 2m tommes, this means the forecast for 2016/17 end stocks has been revised up by 6m tonnes to a record 628m tonnes.
This is especially true for wheat, where the USDA has raised its supply forecast by 2m tonnes while slightly revising down its total use projection. This is due to beginning stocks for this year being higher than previously thought: “The change to beginning stocks stems from a 1.4m tonnes reduction in 2015/16 domestic consumption, primarily in the EU,” the WASDE report reads.
While Australia, Canada, Kazakhstan and Russia are expected to put less wheat on the market this year, the EU and Ukraine will make up for the difference.
Coarse grains
Wheat alone accounts for nearly half of the increase in the USDA’s overall grain end stock estimate for this year compared with the one published last month.
Other grains are expected to see an increase in production (4m tonnes more than in last month’s forecast), partly offset by increasing consumption.
Brazil and Argentina are forecast to export more maize this year. The US will use more maize for ethanol, but less for feed, leaving the country’s ending stocks unchanged, according to the USDA.