The Agricultural and Horticultural Development Board (AHDB) is pointing to a projected downturn in some global grain output trends.
This follows that the releases by the United States Department of Agriculture (USDA) released its June World Agricultural Supply and Demand Estimates (WASDE).
For wheat, Russia’s production was cut considerably, which, as well as cuts across Ukraine and Europe, has consequently tightened the global 2024/25 balance.
There was some tightening to the global 2024/25 maize balance too, both compared to 2023/24 and last month.
However, 2023/24 production figures for Brazil and Argentina were unchanged, opposing the average analyst expectation of a downward revision for both regions.
Global soybean ending stocks for 2023/24 remain the second highest on record (behind 2018/19), despite a marginal cut to Brazilian production.
However, this could become the third highest should the projected 2024/25 ending stocks be achieved.
Wheat
Globally, the wheat outlook is reported to have a tighter balance next year (2024/25), largely as a result of the smaller supply.
Wheat production in Russia, Ukraine, and the EU has been reduced, outweighing the modest increase in global opening stockings.
The hot and dry weather followed by the frosts during May in Russia resulted in the wheat crop being cut from 88.0 Mt in May to 83.0 Mt.
This aligns more closely with recent forecasts from Russia’s Institute of Agricultural Market Studies (IKAR) and SovEcon of 81.5 Mt and 80.7 Mt respectively.
Despite a modest rise of production in the US (+0.5 Mt) and a decrease in global feed demand, the substantial drop of production across key producing regions tightens the projected global wheat balance for 2024/25.
Maize
For the 2023/24 Brazilian crop, the average analyst expectation for maize production ahead of the WASDE report being released was a reduction of 1.1 Mt (London Stock Exchange Group).
Meanwhile, for Argentina average expectation was for a 2.1 Mt cut.
However, in contrast to average analyst expectations, there was no change on the month regarding the ongoing 2023/24 maize harvests in Brazil and Argentina.
As a result, total maize exports rose following slight increases for Russia and South Africa and edged global end of season stocks lower.
Looking ahead to 2024/25, global maize production is projected to be relatively unchanged on the month.
However, the slightly lower opening stocks and an increase to imports tightens ending stocks to closely align with the average analyst estimate.
Soybeans
Although, on average, analysts expected Brazil’s 2023/24 soybean production estimate to fall to 151.8 Mt, the USDA has only only cut production by 1.0 Mt to 153.0 Mt.
For Argentina, 2023/24 production was left unchanged on the month at 50.0 Mt, which closely aligns with the average analyst estimate and the latest Buenos Aires exchange estimate of 50.5 Mt.
As a result, world ending stocks remain the second highest ever at 111.1 Mt.
For 2024/25, estimates remained relatively unchanged on the month. World ending stocks are forecasted at 128.5 Mt which, if achieved, would be the largest ending stocks on record.
This is largely supported by Brazil’s projected record crop of 169.0 Mt.