Grain column with Emma Croft

Emma Croft, farm trader at Anderson Grain Marketing Limited.
Emma Croft, farm trader at Anderson Grain Marketing Limited.

This month’s World Agricultural Supply and Demand Estimates (WASDE), courtesy of the US Department of Agriculture (USDA) were released last week and as explained in my last column, May’s edition included both the usual monthly update to this season’s supply and demand figures, alongside the USDA’s first look at the upcoming 2016/2017 trading season, which commences 1 July.

For the current 2015/2016 trading season, global wheat production was increased further from last month’s already record figure to 734 million tonnes. There were a few changes made to various production and consumption figures, resulting in an increase to global wheat ending stocks by a further 3.65 million tonnes to a record 243 million tonnes (which will definitely not help the old or new crop wheat trade!).

Meanwhile, unexpected reductions were made to this season’s Brazilian maize corn crop although at 81 million tonnes overall output is hardly disastrous. Some noteworthy changes were also made to the US numbers for maize corn, namely the increase in exports (+2 million tonnes), which resulted in a decrease to ending stocks (-1.5 million tonnes).

Regardless of the above changes, maize ending stocks were only reduced by 1 million tonnes and remain firmly above the 200 million tonne mark at 208 million tonnes.

As for the upcoming 2016-2017 trading season, global wheat production is forecast at 727 million tonnes, the second largest crop on record (this season’s crop is the record largest).

For the Northern Hemisphere, a very average crop is forecast for the US, but large crops are expected for most key competing countries; favourable spring growing conditions suggest that yields will be well above trend for Europe, Russia and Ukraine.

Closer to home, the latest HMR&C data has revealed that combined UK wheat and barley exports in March were at their highest monthly level since 2000 at a staggering 684,000/T. UK barley exports were particularly strong with just over 300,000/T, something which we have not seen in any given month since December 1998. As for wheat exports, 383,000/T were exported in March, the strongest month since November 2011.

The above was predominantly aided by currency, but also by an increase in demand from various key exporters. With a huge grain stock carryover forecast for the end of the season, we will need to see exports maintained at this level for the remainder of the season if we to even make a dent in the figures expected.