Even before most wheat has been sown worldwide, the International Grains Council (IGC) has issued a lower acreage forecast for 2018. This is the latest report from the London organization.
According to the IGC, the total wheat area will be slightly lower next season. For example, they predict that the US wheat area will probably reach an all-time low in 2018. For the European territory they expect little change compared to last season and for the former Soviet states the IGC believes a less strong increase than previously assumed.
Record consumption
The decline reaches a historic low and is a result of low yields in both winter and spring wheat. This year, 46 million hectares were sown in the US; the lowest area since 1919. The harvested area of 37.6 million hectares is the smallest since 1890.
Given the poor prices, growers are not expected to expand their winter wheat area, but rather to grow sorghum and corn. At the same time, grain consumption reached a record in 2017/18. With an expected consumption of 2,104 billion tons, this is 13 million tons or 0,6% higher than last year.
Corn production is increasing
The IGC estimates world maize production in 2017/2018 at 1.034 million tonnes and stocks at 203 million tonnes, compared to 1.079 and 235 million tonnes respectively in 2016/2017. Soybean production in 2017/2018 is estimated at 348 million tons. The year before that was 350 million tons. At 39 million tons, stocks are slightly lower than budgeted in September and also lower than the 43 million tons in 2016/2017.
The price of soybeans immediately rose on the Chicago stock exchange. However, the influence of the dry weather conditions in South America and good demand from China should not be ignored here.