World grains outlook increased

Wheat and maize

Amid mostly favourable weather for crops, better prospects for wheat and maize (corn) led the rise. However, a Market Focus highlights the potential risks to the forecast caused by a possible El Niño event later in the year. While projected total consumption is revised a little higher, forecast end-season grain stocks are now seen reaching 412mt, up by 3% y/y (year-on-year) and the most since the end of 1999/00. Increased expectations for maize, barley and sorghum, boost the global trade projection, but it is still seen retreating modestly from the previous season’s high, to 289mt.

Oilseeds

This report features the first formal forecasts for oilseeds supply and demand in 2014/15. Production of soyabeans is projected to rise by 6% y/y, to an all-time peak, boosted by expectations for record plantings in the US and Brazil. Led by demand from processors in China and the Americas, consumption is set to expand by 4%, while the bigger world outturn is seen underpinning significant stock accumulation in the major exporters. China’s imports are expected to grow further, albeit at a less pronounced rate, as world trade rises by 3%, to a new high. Rapeseed/canola output in 2014/15 is forecast to fall by 3% from the previous year’s record, with better EU and Black Sea outturns outweighed by a smaller Canadian crop.

Rice

World rice trade is forecast to be up by 5%, to a record of nearly 40mt in calendar 2014, as large and competitively-priced availabilities boost buying interest amongst key Asian importers. Despite some remaining market uncertainties, an increasingly comfortable outlook for supplies pressured global export prices during June, reflected in a 4% m/m (month-on-month) fall in the IGC Grains and Oilseeds Index (GOI). The sub-Indices for maize (-7%), wheat (-5%) and soyabeans (-4%) all posted significant declines, but tightening nearby availabilities led to a modest increase for rice (+2%).