Grain price: Global wheat supplies forecast to increase by 50 million tonnes
The World Agricultural Supply and Demand Estimates (WASDE) were released this week. Global maize production has been revised down, while wheat estimates have increased on last month.
As of June 11, world maize production was forecast at 1,099 million tonnes in the WADE report. That’s a decrease of 21 million tonnes from the 2018/2019 season. This may reduce further if planting estimates are not fulfilled in the US.
At present, the United States Department of Agriculture (USDA) is estimating that US maize production will be down by 34 million tonnes this season to 347.5 million tonnes due to the on-going struggle to plant in the poor weather conditions. This has led to an increase in maize price and in turn an effect on wheat and barley prices.
AgriLand spoke to David Eudall – Head of Market Specialists with the Agriculture and Horticulture Development Board (AHDB) – this week at Cereals in the UK.
He explained that: “Whilst the tighter maize balance sheet is likely to raise the base price ‘floor’ of global markets, the larger wheat production will prevent any major gains.”
David added that it would most likely take a severe weather issue to bring prices anywhere near last year’s highs.
Weather and yield around the world
The winter wheat harvest has started in parts of the US and crops are looking good. While planting has progressed in some regions, others are still struggling to get crops in the ground.
In Russia and the Ukraine conditions are drying out, but crops should be progressed far enough to limit any major effects on yield.
Wheat production in Australia is expected to rise this season, but drought conditions mean that this is still below the average yield for the country.
The maize harvest is currently underway in Brazil and reports are of very good yields.