Wheat harvest yields up, but prices remain under pressure
Global wheat production is on the rise, with improved harvest forecasts in the EU and India. But even as yields climb, prices are under pressure – pressured by shifting inventories and rising demand in key markets.
EU harvest outlook improves
Last year the European harvest was very poor, with a total yield of just over 122 million tonnes of wheat. In May, the USDA already forecast a much larger harvest in the EU for this season: 136 million tonnes. This has now been adjusted further upwards, to 136.5 million tonnes. USDA attributes this mainly to better conditions in Spain.
Global wheat yields up
The US Agriculture Department also expects higher yields worldwide than in the previous forecast. In May, the USDA assumed a total harvest yield of 808.52 million tons of wheat, but this has now been adjusted slightly upwards: 808.59 million tons. In addition to the EU, India will also produce more wheat: 117.5 million tons, against a previous expectation of 117 million tons.
Wheat demand keeps climbing
Prices are under pressure, despite expectations that global inventories will shrink slightly as consumption rises. The total supply (initial stock and harvest) has been reduced by 1.2 million tons in the new forecast to 1,072.6 million tons of wheat. As demand grows in Nigeria, Sudan and India, consumption is forecast to increase by 1.8 million tonnes to 809.8 million tonnes.
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