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Global grain stocks hit 10-year low

30 May 20244 min reading

According to the latest report from the IGC, global grain stocks are expected to decrease to a decade-low in the 2024/25 season. Despite a projected 1% increase in overall grain output for the season, closing stocks are estimated at 580 million tons, driven by declines in wheat and maize inventories.

The International Grains Council (IGC) released its latest Grain Market Report on May 23, detailing supply and demand projections for the 2024/25 season across major grains and oilseeds, including wheat, maize, soybeans, and rice.

According to the report, world grain output is projected to increase by a further 1% in 2024/25, reaching 2,312 million tons (m t). In contrast to the previous season's trends, maize production is expected to be lower, while other commodities are anticipated to show year-on-year (y/y) gains. Global grain consumption growth is expected to be fairly modest, rising by 9 million tons y/y to 2,320 million tons, with food, feed, and industrial uses reaching new peaks. Closing stocks are pegged at a 10-year low of 580 million tons (-1%), led by declines in wheat and maize, with exporter inventories at 142 million tons (-3%). Maize accounts for most of the 2 million ton reduction in the forecast for global trade, projected at 416 million tons (-4% y/y).

World total grains production in 2023/24 is forecasted to be 4 million tons lower month-on-month (m/m), at 2,297 million tons, mainly due to smaller sorghum and barley estimates. While the supply outlook is somewhat cushioned by increased carry-ins, the estimate for carryover stocks is reduced by 3 million tons m/m, to 588 million tons. Boosted by larger wheat and maize flows, the forecast for trade is increased by 8 million tons from the previous estimate.

GLOBAL WHEAT TRADE EXPECTED TO DECLINE 

The IGC forecasts world wheat production at 790 million tons for the 2023/24 season, increasing to 795 million tons for the 2024/25 season. While world wheat trade reached 206 million tons in the 2023/24 season, the IGC's forecast for the new season is 196 million tons. “While global trade may retreat for a second consecutive season in 2024/25, current supply projections indicate a potential shift in exports from the Black Sea region to other major exporters,” the IGC noted.

According to the report, world wheat consumption will exceed production in the new season, reaching 801 million tons. "Global wheat consumption in 2024/25 is expected to retreat year-on-year (y/y), amid projected smaller crops in some key consumers and strong competition from feed alternatives, including in Europe and Pacific Asia," the IGC said. The IGC estimates world wheat closing stocks for the 2023/24 season at 266 million tons, with a forecast of 260 million tons for the 2024/25 season. Stocks in major exporters are expected to decline from 61 million tons to 56 million tons.

The IGC forecasts world maize production to reach 1.22 billion tons in the 2024/25 season. It also expects corn trade to fall from 186 million tons to 175 million tons. "Global corn output in 2024/25 could expand to a fresh peak despite various constraints, including in Argentina, where significant yield and area losses from corn stunt disease in late-season crops have been noted," the report said.

WORLD RICE PRODUCTION SET TO SOAR

Revised figures for world rice production and total supplies in 2023/24 indicate increases in consumption and aggregate stocks. Boosted by 3 million tons month-on-month (m/m), global rice output in 2024/25 is projected at a record 523 million tons (+2%), leading to an upgraded prediction for combined reserves. Trade in 2025 is pegged at 52 million tons, slightly higher than in April, driven by increased projections for Asian and African buyers, with much of the m/m gain attributed to upward adjustments for Indian and US exports.

Based on larger-than-anticipated dispatches to key markets, including China, the outlook for world soybean trade in 2023/24 has been increased by 2 million tons month-on-month (m/m). Global output in 2024/25 is projected to be 1 million tons higher m/m, and due to higher carry-ins, inventories are raised by about 3 million tons m/m. Trade is predicted to remain steady m/m, at an all-time peak of 172.2 million tons (+2%).


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