Outlook: World coarse grains on the rise

This modest increase masks a 7-million-ton increase for US production and a
5-million-ton decline in foreign output. The largest 2007/08 foreign production
decline was for the EU-27, dropping 3.2 million tonnes to 135.0 million.

Forecast corn
production was reduced 1.5 million tonnes, with reductions for Romania (-0.5
million), Bulgaria (-0.42 million), Hungary (-0.4 million), Spain (-0.3
million), and Italy (-0.2 million) more than offsetting small upward revisions
to other EU countries.
Hot, dry growing conditions during the
summer in Southeast Europe damaged the corn crop, and that damage is becoming
clearer as the plants mature.

EU barley crop down
The EU-27
barley production forecast dropped 1.2 million tonnes this month to 57.3
million. The harvest is virtually complete, and country harvest reports are
indicating reductions mostly caused by rain during the harvest.

Declines
for France, Germany, and several others countries more than offset an increase
in Spain. EU-27 production forecasts for mixed grains and oats were also reduced
this month.

Fewer corn plantings in
Argentina
Prospects for 2007/08 corn production in Argentina were
reduced 1.5 million tonnes to 22.5 million because the price of corn has
declined compared with oilseeds, moderating the expected increase in corn
planted area. Corn harvested area is now forecast to increase 7% over (2009/07)
instead of 14%.

China’s 2007/08 corn production prospects were trimmed 1
million tonnes to 147 million due to hot, dry conditions in parts of the
Northeast corn belt. Australia’s 2007/08 barley crop projection was cut 1
million tonnes to 8 million as a dry, warm winter and early spring have reduced
yield prospects. Forecast barley production for Turkey was dropped 0.8 million
tonnes to 6.5 million as harvest reports indicated low yields caused by dryness.

Brazil corn up
These and smaller reductions in projected
2007/08 coarse grains production more than offset increases for Brazil and the
former Soviet Union (FSU). Brazil’s projected corn production was increased 1
million tonnes to 51 million because corn prices in Brazil have been boosted by
strong exports to the EU-27, which prefers non-GMO corn.

Coarse grains
production in the FSU was boosted 0.8 million tonnes to 53.3 million by a
0.5-million-ton increase for Belarus (barley, rye, and oats) and an increase for
oats in Russia.

For full report read USDA Outlook