Thanks to a second year of bumper crops, the world is headed for mammoth inventories of corn, wheat and soybeans, says the International Grains Council in London. The IGC’s index of grain and oilseed prices is 10 percent lower than a year ago. Prices are high by historical standards but sharply below the levels seen since the agricultural boom began in 2006.
In its Monthly Grain Report, IGC forecast record corn and wheat consumption during this marketing year. All the same, the wheat “carryover” into the new marketing year would be the largest in four years and the corn carryover would be the largest in 27 years. Wheat stocks in Europe would nearly double.
IGC pegged the U.S. corn crop at 365 million tonnes, lower than USDA’s estimate of 367.7 million tonnes (14.475 billion bushels), with slightly smaller exports and a larger carryover than USDA.
“With hot weather disrupting the early stages of 2014/15 soybean planting in Brazil, the world production forecast is lowered by 3 (million tonnes), still 8 percent higher (year-on-year) and a new record,” said IGC. Soybean stocks would zoom by 38 percent “almost entirely in the major exporters, primarily in the United States.”