Summary
HIGHLIGHTS
The forecast for world total grains (wheat and coarse grains) production in 2023/24 is lifted by 3m t m/m (month-on-month), to 2,295m. Changes from October include an upgraded outlook for maize, tied mainly to reports of better than expected US yields, as well as an increased wheat figure, reflecting latest updates for Ukraine, Russia and Turkey. At 2,308m t, the projection for total grains consumption is also 3m higher m/m, with most of the adjustment for maize. With supplies boosted by an increase in estimated opening stocks, the forecast for end-season carryovers (aggregate of respective local marketing years) is up by 3m t, to 585m. The world trade (Jul/Jun) projection is lifted by 1m t m/m, as an upward adjustment for maize shipments more than compensates for cuts for wheat and sorghum.
Tied to uprated figures for the US and Black Sea producers, 2023/24 world soyabean output is seen marginally higher m/m, at a record of 395m t, 7% higher y/y (year-on-year), while consumption and aggregate inventories are predicted broadly steady m/m. Trade is projected unchanged from before, at 168m t (-2% y/y), including smaller deliveries to key destinations in the Americas and Asia.
There are few changes to the Council’s outlook for rice supply and demand across the entire forecast period; the net y/y increase in supplies is matched by marginal gains in total use, leaving 2023/24 aggregate stocks broadly steady, at 171m t. Reflecting a downgraded outlook for China’s imports, traded volumes in 2024 (Jan/Dec) are pegged fractionally lower m/m, at around 50m t (-4%).
The IGC Grains and Oilseeds Index (GOI) edged higher in November, with gains mainly driven by firmer soyabean values.
Led by expectations for a bumper world maize harvest, total grains (wheat and coarse grains) production is forecast to rise by 1% in 2023/24. Although wheat output will be smaller y/y, the crop is still expected to be the second largest on record. Total demand is placed at 2,308m t (+2%), mostly on gains in feed and industrial uptake. World stocks at the end of 2023/24 are seen dropping by 2% to 585m t, a seventh consecutive year of tightening, including reductions for wheat (-6%), barley (-11%) and oats (-50%). However, boosted by large US maize carryovers, total exporter stocks are seen gaining by 10% y/y. Another reduction in global grains trade is envisaged, seen at a five-season low of 410m t (-4%).
Chiefly linked to bigger crops in South America, global soyabean production is forecast to expand by 7% y/y, to a record of 395m t. With uptake in the three majors expected to advance solidly, led by a sizeable expansion of processing in Argentina, courtesy of a bigger harvest, world utilisation is predicted at a fresh high (+8%). Trade is likely to decline given potentially reduced deliveries to China and Argentina. Nevertheless, Brazilian exports are anticipated to grow as US dispatches decline.
With bigger crops in Asia and the Americas, global rice output in 2023/24 is seen at a peak of 521m t (+6m). A population-driven increase in food demand is set to underpin consumption, while inventories, the bulk of which are located in China, are predicted near-unchanged y/y. Trade in 2024 (Jan/Dec) is projected to contract by 4% y/y on softer buying interest from Asia and Africa. While shipments by Pakistan and the US could expand, Indian dispatches are likely to drop sharply.
After the prior year's solid rise, world chickpeas output is seen declining by 6% y/y on a reduced Indian harvest. While total use could edge up, aggregate inventories are set to tighten (-15%), tied to a drawdown in key exporters. Trade in chickpeas is predicted to contract by 4% y/y in 2024 (Jan/Dec) on softer Asian demand. Separately, total pulses trade in 2023 is projected to maintain an upward trend, rising by 8% y/y on larger shipments of dry peas and lentils in particular.
MARKET SUMMARY
The IGC GOI ticked higher over the past month, as gains in soyabean and rice prices more than compensated for weakness in grain markets.
The IGC GOI wheat sub-Index dipped by 2%, weighed mainly by seasonal weakness in the main southern hemisphere exporters. However, gains were noted in some other markets, including in Russia, amid an appreciating local currency and waning producer selling interest.
Amid softer quotations across all origins, but particularly in Argentina, the IGC GOI maize sub-Index dropped by 7%, recently touching a three-month low.
The IGC GOI rice-sub Index firmed fractionally m/m, with gains in Vietnamese 5% broken quotes just about offsetting declines in Thailand.
Bolstered by a recent uptick in US export demand, sub-optimal Brazilian cropping weather and support from stronger soyameal markets, the IGC GOI soyabeans sub-Index registered a 5% monthly gain.