The Hindu Business Line : Record wheat, maize output forecast

BUOYED by larger than expected yields in the US and Europe, global wheat output during 2004-05 is expected to hit a new record of 614 million tonnes (mt), some 60 mt more than 554 mt harvested in the previous year.

World consumption, on the other hand, will rise by 17 mt to a new high of 605 mt in 2004-05. With production trailing consumption for the first time in about five years, global wheat stocks are expected to reverse the declining trend and increase.

However, these developments are unlikely to impact global trade volumes that are projected to remain at 101 mt (102 mt). China's import forecast is 7 mt, almost double that of last year.

According to the London-based International Grains Council (IGC), which presented the forecasts, global import demand has been largely routine, but markets in several exporting countries strengthened recently because of a combination of logistical and weather factors, with slow farmer sales of new wheat crop, especially in the European Union and the US, further supporting prices.

Coarse grains are likely to reflect similar trends. The IGC has forecast global production of 962 mt (910 mt), consumption of 957 mt (940 mt) and ending stocks at 140 mt, up from 135 mt of previous year.

Of this, world maize (corn) represents 663 mt in terms of production, up 41 mt from last year. Continued favourable weather in the US corn belt should result in record yields and the crop is forecast at 277 mt, the report said adding that world maize consumption will reach 663 mt.

Animal feed requirements are expected to increase as global meat demand expands and use for ethanol in the US continues to grow rapidly.

The IGC pointed out that prices were underpinned by concerns about late-season weather, especially a sharp dip in temperatures in the third week of August, renewed strength in soyabean prices and continued strong domestic feed and ethanol demand.