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IGC forecasts total grains output to climb by 2%

Convening for its annual meeting this week in London, members of the International Grains Council (IGC) released their grains, rice and oilseed production outlook for 2019-20.

Total grains production in 2019-20 was projected to climb by 2% and would help to compensate for smaller opening stocks to lift overall supply a fraction higher than the season before. Nevertheless, with consumption growth predicted to outstrip the rise in supply, the third successive stock contraction was envisaged.

 
The Council said the retreat was entirely because of shrinking maize inventories, to their smallest in six years. In contrast, after falling in the prior season, wheat stocks were expected to rebound to a record level at the end of 2019-20. Grains trade was projected to expand on anticipated increased shipments of wheat and barley and would potentially exceed the peak of two years ago.

 Global soybean production was seen marginally lower in 2019-20, compared to the previous year, as a potentially smaller U.S. output was only partly offset by larger crops elsewhere, principally in Brazil.

Owing to the prolonged impact of African swine fever on Chinese demand, any expansion of global use was expected to be modest. Coupled with record opening stocks, carryovers were projected to remain elevated, especially in the United States. Given policy and demand uncertainties, trade was tentatively placed little changed from the year before. The Council also forecast a further drop in global rapeseed/canola output in 2019-20 on smaller harvests in the E.U. and Canada, but exporters’ stocks were expected to be plentiful.

 World rice production was projected at a new peak in 2019-20, as gains in some Asian producers and Africa more than offset an anticipated decline in China and the Americas. Global stocks would potentially reach a new high, albeit with China holding around 60% of the total. Trade in 2020 (January/December) was anticipated at a new all-time peak, with India remaining the leading exporter. Demand was expected to be underpinned by African purchasing, with buying from Far East Asia potentially subdued amid ample local availabilities.

 In other business, the Secretariat updated the Council on progress with its economic work program, including global five-year supply and demand projections to 2023-24, recent developments in the ocean freight market (GOFI), including an update on the new cost and freight calculation tool, and progress on establishing supply and demand balances for the world pulses sector. The Council considered recent changes in national policies as well as various administrative matters.

Providing the fullest possible market information on grains, rice and oilseeds;
Continuing to develop its work on pulses and collecting trade data to establish supply and demand balances for the major exporters;
Enhancing collaboration with AMIS and other international organizations and the African region;
Increasing information on the total cost of trade for grains and oilseeds.  
The Council appointed Nathalie Dubé, Minister-Counsellor, High Commission of Canada, as chair of the Council for 2019-20 and Corinne Roux, policy adviser, Trade Relations Unit, Federal Office for Agriculture (FOAG), Switzerland as Vice-Chair.

The IGC will welcome over 350 industry representatives to the 28th IGC Grains Conference on June 11-12. Leading government and industry speakers will exchange views on global grains and oilseeds market trends, including a focus on Africa, new developments in risk mitigation and how new technologies and climate change are shaping the grains and oilseeds sectors. 

 Day two of the conference will feature six workshops covering biodiesel trends, prospects for wheat products, pesticide MRLs and their importance for international trade of agricultural commodities, managing price risk in the rice trade and future of the grains shipping sector. The IGC will present a panel on its work with industry and governments to achieve a market and regulatory environment supportive of trade that avoids disruptions in the international movement of grain, oilseeds, pulses and derivatives products.   


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