Analysis Grains & Commodities
IGC expects record grain consumption
The mood on the wheat market is slightly more positive. A tender for wheat from Tunisia closed and Algeria appears to have bought more wheat this week than previously expected. The drought in the US is also supporting the wheat market. The IGC has revised the forecast for the grain harvest upwards, but on the other hand, a record amount will also be consumed in the 2025/26 season.
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Choose the subscription that suits youThe May wheat contract on the Matif closed yesterday €2,25 higher at €211,25 per tonne. On the CBoT, there was relatively little movement in the grain market. Wheat closed 0,2% higher at $5.48¾ per bushel. Corn lost a little with 0,4% to close at $4.82¼ per bushel. Soybeans also took a step back with a minus of 0,2% to close at 0.36½ per bushel.
The International Grains Council (IGC) has increased the total grain production for the 2025/26 season to 2.373 million tonnes in the latest forecast. This was 2.368 million tonnes in the March update. In the 2024/25 season, a total of 2.303 million tonnes of grain was harvested. According to the IGC, grain consumption will rise to a record high of 2.373 million tonnes, equal to production. The predicted larger grain harvest is mainly due to an expected bumper harvest for maize. Compared to last season, the IGC expects threshing to be 1.274 million tonnes more than last season, at 66 million tonnes. The IGC estimates the wheat harvest at 806 million tonnes. This is 1 million tonnes less than in the March forecast, but 8 million more than last season. The expected wheat consumption has been increased by 1 million tonnes to 814 million tonnes. If the estimate comes true, we will be drawing down our wheat supplies for the fourth year in a row.
Looking at the inventory and production figures, you would expect the sentiment in wheat to be somewhat bullish is and in corn bearish. The opposite is happening in the IGC price index. Wheat is going down a bit and IGC is noticing strongly fluctuating prices in the large exporting countries. The corn index is up 3%. The market is showing some recovery after the decline last month, the IGC notes.
Tenders
Tunisia has secured 75.000 tonnes of wheat in a tender for delivery in May/June. The average price is $264 per tonne C&F (freight forward), according to sources. Algeria closed a tender earlier this week and more wheat than expected has probably been secured. After the tender was closed, sources said Algeria had bought 540.000 tonnes, but now they are talking about 600.000 to 630.000 tonnes secured by the North African country. Due to diplomatic tension between Algiers and Paris, French wheat was excluded and French grain trading companies were also not allowed to bid on the tender.
In the US, the wheat market is primarily a weather market. And the central question is whether or not there will be rain on the southern prairies. There is some precipitation in the forecast for the coming weekend, but what will actually fall remains to be seen. The latest drought monitor does show that winter wheat needs moisture. Almost the entire growing area in the most important states of Kansas and Oklahoma is colored red this week.
