Highlights
Including larger than previously predicted maize and sorghum harvests, but with cuts for wheat, barley and oats, the forecast for world total grains (wheat and coarse grains) production in 2021/22 is 5m t higher m/m (month-on-month), at 2,289m, up by 3% y/y (year-on-year). Given larger than previously estimated opening stocks and increased production, and with the figure for consumption unchanged m/m, the outlook for global stocks at the end of 2021/22 is boosted by 10m t m/m, mainly for maize. Including increased wheat shipments, the forecast for global total grains trade (Jul/Jun) is up by 2m t m/m, to 416m.
There are few significant changes to the Council’s outlook for soyabean supply and demand in 2021/22, with bigger harvests in the US and Brazil expected to underpin record production, seen unchanged m/m, at 380m t (+5% y/y), due to offsetting adjustments for Argentina and the US. Projections for total use and trade are maintained at new peaks.
Despite a further upgrade for Chinese feed demand, global rice consumption in 2020/21 is placed 3m t lower m/m to reflect a downgrade for India, linked to historic data revisions. Taking account of a higher figure for carry-ins, the forecast for stocks is lifted by 8m t m/m. This feeds through to an increased projection of world reserves in 2021/22, raised by 10m t m/m, to a peak of 182m (+3m y/y). Trade in 2022 is predicted 1m t higher m/m, at 48m (+1m).
After two-sided movements since the last GMR, the IGC Grains and Oilseeds Index (GOI) posted a modest net gain.
OVERVIEW
With a sharp rise in maize output anticipated, but with increases for wheat and sorghum as well, global total grains (wheat and coarse grains) production in 2021/22 is forecast to climb by 3% y/y, to 2,289m t. Led by a jump in maize use amid more ample supplies, world total grains consumption is expected to expand by 3%, to 2,288m t. After four successive annual contractions, world stocks are expected to broadly stabilise, as falls for wheat, barley and oats are seen being balanced by build-ups of maize, sorghum and rye. Grains trade is predicted to shrink by 11m t y/y, to 416m, mainly linked to smaller shipments of maize and barley.
In a season of reduced buying interest from China, world soyabean trade in 2020/21 is set to contract by 2% y/y. Tied to expectations for sizeable harvests in key producers, 2021/22 world output is predicted to increase by 5% y/y, to 380m t. Assuming solid demand growth in Asia and the Americas, global use is seen at a new peak (+4%), while stocks could accumulate further. However, major exporters’ inventories are anticipated to remain tight given limited potential for gains in the US amid elevated local and international demand. Bigger shipments to Asia are projected to support a 3% expansion of trade.
Solid demand from buyers in Asia and Africa is expected to boost rice trade to a peak of 47m t in 2021, with India potentially taking a 40% share of exports. Global output in 2021/22 is seen rising by 1% y/y, to a record of 512m t, principally on bigger harvests in Asia. Consumption is set to expand on population gains, albeit as uptake in China likely retreats on lower feed use, while stocks are seen increasing by 3m t y/y, mostly on accumulation in India. Global trade in 2022 is predicted to edge up, with Thailand potentially reclaiming market share from India.
MARKET SUMMARY
The IGC GOI firmed by 1% m/m, boosted mainly by gains in average wheat, maize and barley export quotations.
Underpinned by persistent concerns about production prospects in some major northern hemisphere exporters, the IGC GOI wheat sub-Index rose by 3% m/m. The IGC GOI maize sub-Index increased by 2%, mainly on firmer US values, buoyed by Gulf port capacity constraints and reports of disappointing early yields in some states.
The IGC GOI rice sub-Index held mostly steady, with mixed market movements at key origins. The IGC GOI soyabeans sub-Index was stable m/m, as modest losses in US quotations, tied mainly to looming harvest pressure, was balanced by gains in Argentina.